Economic contraction drags down tax receipts

Jakarta (ANTARA) – Indonesia’s tax receipts fell 19.7 percent to Rp1,070 trillion in 2020 from Rp1,332.7 trillion in 2019 due to the economic contraction and provision of tax incentives to COVID-19 affected citizens, Finance Minister Sri Mulyani Indrawati said.

“This caused several revenues to have been foregone or to be borne by the government because it is aimed at providing room to the public,” she said at an online press conference on the realization of the 2020 state budget here on Wednesday.

The tax receipts of Rp1,070 trillion represented 89.3 percent of the target of Rp1,198.8 trillion set under Presidential Regulation No. 72 of 2020, she informed.

All types of tax receipts from oil and gas as well as non-oil/non-gas sectors recorded a contraction due to the COVID-19 pandemic, she said.

Income tax receipts from oil and gas in 2020 reached Rp33.2 trillion, a decline of 43.9 percent compared to Rp59.2 trillion a year earlier.

Meanwhile, non oil/non-gas tax receipts contracted 18.6 percent to Rp1,036.8 trillion from Rp1,273.5 trillion in the year-ago period.

The pandemic also posed a special challenge for the Directorate General of Taxation since 22 tax officers died of the infection. In total, 39 employees within the Finance Ministry died of COVID-19.

So far, the Finance Ministry has reported 1,171 confirmed COVID-19 cases.

“Under this current situation, the tasks of tax officers to maintain state revenues are very challenging,” Indrawati remarked.

Source: Antara News