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Govt to cut Rp 133 trillion in second budget adjustment
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Finance Minister Sri Mulyani Indrawati speaks to journalists after her inauguration ceremony at the State Palace in Jakarta on July 27. (AP Photo/Tatan Syuflana)
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otwithstanding its much-hyped flagship program of a tax amnesty to increase tax revenue, the government anticipates a Rp 219 trillion (US$ 16.66 billion) shortfall in 2016 tax revenues. Therefore, the government has decided to revise the revised 2016 budget.
Finance Minister Sri Mulyani Indrawati said that in view of the projected revenue shortfall, the government would cut allocated spending by Rp 133 trillion to maintain a credible budget.
The government would cut spending my ministries and agencies by Rp 65 trillion and regional transfers by Rp 68 trillion, she added.
(Read also : Jokowi calls for discipline in budget spending)
The government had already cut planned expenditure by Rp 50.2 trillion in the revised 2016 state budget from the initial budget plan.
"With the budget adjustment, we predict the budget deficit in 2016 to reach 2.5 percent of the gross domestic product (GDP), slightly higher than the 2.35 percent [projected] in the revised state budget, due to a Rp 17 trillion increase in financing," Sri said after a plenary Cabinet meeting at the Presidential Office on Wednesday. (bbn)
