Indonesia's 2022 deficit to drop below 4% despite subsidy hike, says Finance Ministry

Finance Minister Sri Mulyani Indrawati holds a press briefing on July 1, 2022 regarding the voluntary disclosure program, dubbed the second tax amnesty. - Jakarta Post/ANN

JAKARTA, July 4 (Jakarta Post/ANN): The Indonesian Finance Ministry is confident that the state budget deficit will drop below 4 per cent of gross domestic product (GDP) this year, pointing to faster-than-planned fiscal consolidation despite increased spending to shield Indonesians from surging global energy prices.

After a second downward revision, the ministry now expects the difference between state revenue and spending to reach just 3.92 per cent of GDP, much lower than its previous projection of 4.5 per cent as well as the budget plan’s original assumption of 4.85 per cent.