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Indonesia Sees Drastic Cut to Budget Deficit on Tax Windfall

  • Finance minister estimates fiscal gap at 4.1% of GDP next year
  • Budget deficit on track to fall within statutory limit by 2023
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WATCH: Indonesia’s Indrawati expects the budget deficit in 2022 should come in at 4.1% of gross domestic product, a steep decline from this year.Source: Bloomberg
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Indonesia’s finance chief further cut estimates for the budget deficit this year 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 this year, 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 October, she said.