Covid Stimulus Running Out Threatens Indonesia’s Growth Target
- Some incentives for companies, consumers due to end this month
- Investment growth could take a hit, business group warns
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Most of Indonesia’s pandemic-era fiscal incentives are set to expire at the end of the month, adding a new layer of challenge to the economy already facing risks from quickening inflation and a looming increase in borrowing costs.
Removing tax stimulus for consumers and companies should help guide the fiscal deficit back under its legal limit by 2023. But the move could set back investment and consumption that are key to achieving the 5.2% growth target this year.