Indonesia Sees Drastic Cut to Budget Deficit on Tax Windfall

  • Indonesia’s finance chief further cut estimates for the budget deficit 2021 and next, as a fresh round of tax hikes is set to bolster the government’s earnings.
  • The shortfall should come in at 4.1% of gross domestic product in 2022, much lower than the 4.85% it set in the national budget, Finance Minister Sri Mulyani Indrawati said in an interview with Bloomberg Television’s Rishaad Salamat.
  • That’s a steep decline from 2021, when the deficit is seen at the lower end of the 5.1%-5.4% range due to tempered spending and an 18% jump in state revenues as of Oct 21, she said.
  • The government still has “a very good chance” of reaching its target of bringing the budget deficit back under the legal limit of 3% of GDP by 2023, said Indrawati.

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