Sri Mulyani Strengthens Government's Commitment To Pursue A 3 Percent Fiscal Deficit In The 2023 RAPBN

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JAKARTA - The government through the Minister of Finance (Menkeu) Sri Mulyani emphasized that her party was continuing to make fiscal consolidation efforts in order to achieve the 3 percent budget deficit target in the upcoming 2023 APBN. According to the Minister of Finance, this step is also the implementation of Law No. 2 of 2020 or Perppu No. 1 of 2020.

"The highest deficit is 3 percent of GDP (gross domestic product) in 2023," he said at the DPR Plenary Meeting regarding the Government's Response to Factions' Views on the KEM PPKF RAPBN 2023 at the Senayan Parliament Complex, Jakarta, Monday, May 31.

The Minister of Finance revealed, the government has compiled a number of special implementations so that these targets can be achieved, namely the implementation of the Law on Harmonization of Tax Regulations (HPP) and the Law on Central and Regional Financial Relations (HKPD).

"These two laws are important foundations in the context of a smooth and safe transition to fiscal consolidation without disturbing the sustainability of the national economic recovery," he said.

The Minister of Finance added that the government would also continue to strengthen the spending side through the spending better program in order to increase efficiency and effectiveness, both at the center and the regions.

To note, before the pandemic, the state financial management (APBN) mandated a maximum fiscal deficit of 3 percent of GDP.

More space was then provided through Law Number 2 of 2020 by allowing the deficit to increase to around 5 percent of GDP as an effort to overcome the impact of the pandemic.

However, in the 2023 APBN, the government must be able to manage the budget to return to a deficit level of 3 percent of GDP in accordance with the previous stipulation.