Indonesia raises tax revenue target for this year

Jakarta (VNA) – The Finance Ministry of Indonesia has raised its tax revenue target for 2022 to 9.3 – 9.5 percent of GDP, banking on the implementation of new tax regulations and continued economic recovery.

Febrio Nathan Kacaribu, head of the ministry’s Fiscal Policy Agency, said the target is higher than the 9.11 percent achieved last year, noting that this target took into account the Harmonised Tax Law taking effect this year.

This law raises income tax for the rich, increases value-added tax (VAT), and introduces carbon taxes and a second tax amnesty programme.

The tax-to-GDP ratio of the archipelago nation dropped to 8.3 percent in 2020, the lowest in the past decade due to the shrunken state revenue as a result of a pandemic-caused economic recession./.