Sri Mulyani Announces Changes in Gov’t Spending Amid COVID-19 Outbreak
Date 18 April 2020
The Government’s spending in the next few months will change as state revenues are under pressure and government expenditure is increasing.
According to Minister of Finance Sri Mulyani Indrawati, the expenditure is particularly allocated to provide assistance for health and social sectors, as well as boost the economy.
The Minister also said that the State Budget provides assistance for health, social and economic sectors, all of which are effected by the ongoing COVID-19 pandemic.
“We are trying to launch stimulus or policies to cope with these enormous shocks. However, not all the shocks can be tackled by the State Budget. The State Budget can only support social security of the people,” she said.
The Minister also acknowledged the COVID-19 pandemic is affecting the business world; hence, the State Budget will provide supports so that the impacts will not too severe or cause massive fallout.
“We hope the business world can remain robust in the face of these shocks, assisted by stimulus or fiscal policies that help minimize those massive impacts,” she said.
In the health sector, Sri Mulyani said that the Government will continue to provide supports in the handling of the pandemic, including for rapid tests, reagents to personal protective equipment, the purchase of ventilators, and other needs.
The Government will also launch a social safety net program for those threatened with layoffs and for informal sectors experiencing a huge pressure due to the social-distancing and work-from-home orders.
In addition, the Government will also provide a 50% reduction in electricity tariff for 900VA household customers and 100% reduction for 400VA household costumers.
“More than 31 million households will benefit this policy. And the number of people will receive unemployment benefits (pre-employment card) reach 5.6 million workers in both formal and informal sector,” she said.
For industries, the Minister said that the Government will expand tax incentive including for VAT and corporate tax, as well as provide stimulus in the form of the people’s business credit (KUR) and ultra-micro financing (UMi). (TGH/EN)
Reviewed by: M. Ersan Pamungkas