Indonesia's 2025 Tax Revenue Faces Shortfall Amid Economic Slowdown

Finance Minister's Warning on Tax Target

Finance Minister Purbaya Yudhi Sadewa has cautioned that Indonesia's tax revenue for 2025 is likely to fall short of the projected target of Rp 2,189 trillion. The shortfall is attributed to the slowing economic growth, which has impacted tax collection. Speaking at the Financial Forum 2025 held at the Indonesia Stock Exchange (BEI) Main Hall, Purbaya stated, "Because the economy is slow, our tax revenue will be below the initial target."

Budget Deficit Management

Despite the anticipated tax revenue shortfall, Purbaya reassured that the 2025 budget deficit will be kept within the legally mandated limit of 3% of GDP. According to Law No. 17/2003 on State Finance, the government is committed to maintaining fiscal discipline. Purbaya emphasized, "We will certainly implement controls so that the deficit does not exceed 3%. We will not violate the 3% deficit limit for this year."

Economic Context and Implications

The predicted shortfall in tax revenue highlights the challenges facing Indonesia's economy as it navigates through a period of slower growth. The government's ability to manage the budget deficit while stimulating economic activity will be crucial in the coming months. The Finance Minister's comments underscore the need for careful fiscal management to balance revenue shortfalls with expenditure priorities.