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Corporate tax revenue plunges 23% yoy as commodity prices normalize
“Our state revenue experienced extraordinary pressures until July or August," Finance Minister Sri Mulyani Indrawati said in a press briefing on Wednesday
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Finance Minister Sri Mulyani Indrawati prepares a presentation on the state budget at the ministry’s building in Jakarta on Jan. 2, 2024. (The Jakarta Post/Deni Ghifari)
T
he government has collected far less corporate income tax this year, with the Finance Ministry attributing the decline to lower global commodity prices.
Corporate income accounts for some 17 percent of the country’s tax revenue, making it the second-largest contributor, just below value-added tax (VAT) at over 25 percent, according to Finance Ministry data.
The government saw a 23 percent year-on-year (yoy) decline in corporate income tax collection in the first 11 months of the year, with a total of Rp 289 trillion (US$18.1 billion) collected in the period.
From 2022 to 2023, corporate tax collection rose by 15 percent in the same period.
“Our state revenue experienced extraordinary pressures until July or August. State revenue from tax and even from customs and excise underwent remarkable pressures since last year,” Finance Minister Sri Mulyani Indrawati said in a press briefing on Wednesday.
She noted that the price of coal, one of the country’s main export commodities, declined by 22 percent year-on-year (yoy).
This aligns with a decline in global commodity prices after 2022, when geopolitical tensions contributed to pricier commodities and Indonesia enjoyed a tax revenue windfall as corporations’ earnings increased.
