Indonesia will include the stimulus as part of regular programs at ministries and government agencies, as compared to the Rp 73.3 trillion specifically designated stimulus this year in the form of tax incentives and infrastructure funds, Anggito Abimanyu, the Finance Ministry's head of fiscal policy, said last Friday.

"If we look at the percentages, *next year's stimulus* will be less than 1 percent *of Indonesia's GDP*. This year it is 1.4 percent," he said. Next year's stimulus would reach Rp 60 trillion.

"The largest part is tax incentives comprising a lower income tax rate for companies - to 25 percent *from the existing 28 percent*, and public-listed companies will be given another 5 percent cut," Anggito said, referring to the policy stated in the income tax law endorsed last year.

Next year's budget expenditure is set at Rp 1,047.67 trillion, up from Rp 1,000.8 trillion this year.

The budget deficit is set at Rp 98 trillion (US$9.8 billion), or 1.6 percent of GDP, lower than this year's, which is estimated to reach Rp 129.8 trillion, or 2.4 percent of GDP, according to a working group between the government and the House of Representatives' budget committee that is working on the 2010 state budget bill.

Finance Minister Sri Mulyani Indrawati said seeing the 2010 deficit, the ability of budget expansion to boost the economy would be lower.

She said government spending next year would be relatively modest, while private consumption would remain more or less similar. However, investment growth may double as the existing monetary and fiscal policies, as well as structural policies, had provided stronger grounds for the private sector to invest, she said.

At the recent G20 meeting in London, many said stimulus measures must be maintained, especially by developed economies, until the global economy fully recovers.

Based on the latest assumptions in the 2010 budget bill, the government and House have agreed to set growth at 5.5 percent, up from this year's estimated 4.3 percent.

Analysts have said the economy would run well even without economic stimulus, as long as the government could spend its budget as early as possible.

Usually the government spends most of its money toward the end of the year, which analysts say is counterproductive.

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