Pandemic Hits Hotels And Restaurants, Batam City Government Predicts Budget Deficit Of Rp200 Billion

Deputy Mayor of Batam Amsakar Achmad. (ANTARA/HO-_Batam City Government)

BATAM - Batam City Government, Riau Islands predicts that the 2021 APBD will experience a deficit of up to Rp200 billion. The reason is that local revenue is not in line with the target due to the COVID-19 pandemic.

"The deficit is due to local revenue from hotels and restaurants that do not meet projected expectations. As we know, this sector is the hardest hit (the COVID-19 pandemic)," Batam Deputy Mayor Amsakar Achmad said as quoted by Antara, Friday, June 25.

The Batam City Government budget team initially predicted a deficit of up to Rp400 billion, but after further dissecting the figure could be reduced to Rp200 billion.

According to him, the government is targeting revenue from hotel and restaurant retribution taxes to be quite high because it is optimistic about the reopening of tourism, following the improving COVID-19 transmission rate at the end of 2020.

However, it turned out that the transmission of COVID-19 had increased again, so the plan to open the border with Singapore for tourism was postponed. And this causes regional income to miss the target.

"When the 2021 APBD was compiled, there was a good change in the issue of resolving COVID-19, the numbers were improving. We also thought that at that time the "travel bubble" policy was to be implemented in 2021. It turned out that a number of requirements were still needed. So the budget deficit fell from the target," said Amsakar.

He emphasized that the deficit was not due to large spending, but because the PAD target was not being met.

The Deputy Mayor explained that in Batam's APBD structure there were five contributions from APBD contributors, namely Land and Building Tax (PBB) and Land Rights Acquisition Fee, street lighting tax, the extension of Permit to Employ Foreign Workers, hotel tax, and restaurant tax.

"The last two components have a small fee. So it's not because of the high cost, but the revenue target is not being met," said Amsakar.