Govt presents revised budget<\/p>\n
JAKARTA (JP): The government announced yesterday a revised
\n1998\/1999 budget, raising revenue and expenditures and reducing
\nfuel subsidies, but closely following recommendations by the
\nInternational Monetary Fund (IMF).<\/p>\n
The budget, presented by Minister of Finance Mar'ie Muhammad
\nbefore a House of Representatives' plenary session, failed to
\nimpress the currency market as the rupiah continued to remain
\nweak at 13,000 to the U.S. dollar yesterday.<\/p>\n
The revised budget, balanced by law, was set at Rp 147.22
\ntrillion (US$11.3 billion), compared to the Jan. 6 budget
\nestimate of Rp 133.5 trillion. This is an increase of 45.6
\npercent over the current budget ending March 31.<\/p>\n
\"We are pursuing a balanced budget because it is in accordance
\nwith our State Policy Guidelines,\" Mar'ie said at the plenary
\nsession.<\/p>\n
\"There are differences with the IMF, which has projected that
\nour budget should book a deficit of 1 percent in the GDP (gross
\ndomestic product),\" Mar'ie said.<\/p>\n
Nevertheless, in drafting the new budget, the government
\nfollowed all projections of the IMF, the organizer of a $43
\nbillion bailout package for Indonesia.<\/p>\n
The projections include zero economic growth in the next
\nfiscal year starting April 1, inflation of 20 percent and an
\naverage rupiah rate of 5,000 to the U.S. dollar.<\/p>\n
On Jan. 6, President Soeharto announced a draft state budget
\nwhich was largely discredited after he predicted a 4 percent
\neconomic growth, 9 percent inflation and an exchange rate of
\n4,000 rupiah to the dollar.<\/p>\n
The rupiah fell rapidly after that announcement and the
\ngovernment, seeking to halt the slide, reached an agreement with
\nthe IMF last week on an accelerated reform program.<\/p>\n
The revised budget, however, lacked any surprise as Soeharto
\nhad already mentioned most basic changes when he signed a massive
\nreform deal with the IMF.<\/p>\n
Yesterday's speech by Mar'ie, confined to budgetary figures,
\nmade no mention of the accelerated economic reforms or any
\nefforts to resolve the country's mounting corporate debt, seen as
\nthe culprit behind the continuing fall of the rupiah.<\/p>\n
Indonesia's outstanding debt stood at $140 billion as of the
\nend of 1997, of which corporate debt formed at least $66 billion.<\/p>\n
Key among the revised figures announced yesterday was a cut in
\nfuel subsidies to Rp 7.45 trillion from the previous estimate of
\nRp 10.08 trillion -- part of the agreement with the IMF.<\/p>\n
The government has said that it will raise fuel prices to
\nreduce subsidies starting April 1.<\/p>\n
All other figures in the new budget are basically similar to
\nprevious ones. They differ only because the projection on the
\nrupiah's exchange rate is different, rising from 4,000 to 5,000.<\/p>\n
Development expenditures, for instance, have been set to
\nincrease to Rp 49.39 trillion from the previous projection of Rp
\n41.11 trillion due to the rupiah's raised exchange rate.<\/p>\n
Routine expenditures are set at Rp 97.8 trillion, up from the
\nprevious projection of Rp 92.38 trillion mostly because of
\nincreasing foreign debt servicing from Rp 32.09 trillion to Rp
\n39.74 trillion.<\/p>\n
\"Again, this increased foreign debt servicing is mainly due to
\nchanges in the exchange rate,\" Mar'ie said.<\/p>\n
Revenue from the oil and gas sector is forecast to be Rp 34.6
\ntrillion, up from the previous estimate of Rp 27.28 trillion.<\/p>\n
Mar'ie said the difference was mainly \"boosted by higher
\nexchange rates\" as the projection in crude oil prices remained
\nthe same at $17 per barrel.<\/p>\n
Oil and gas revenue will account for 30.1 percent of domestic
\nrevenue in the next budget compared to 16.9 percent in the
\ncurrent one.<\/p>\n
Foreign assistance was put at Rp 32.2 trillion, up from the
\nprevious projection of Rp 25.8 trillion due to the higher
\nexchange rate. This represented a 147 percent increase from Rp
\n13.03 trillion in the current budget.<\/p>\n
Non-oil revenue, the backbone of growth in the past budget,
\nwill grow a mere 9.8 percent from the current budget to Rp 80.4
\ntrillion mainly backed by a 74 percent growth in non-tax revenue.<\/p>\n
Income tax revenue is estimated to drop 12 percent from the
\ncurrent budget to Rp 25.6 trillion because of a \"slowdown in
\neconomic growth and losses due to foreign exchange rates\", Mar'ie
\nsaid.<\/p>\n
But the loss would be offset by higher income from value-
\nadded, import duty and export taxes, and a new tax on land and
\nbuilding ownership effective in July.<\/p>\n
Revenue from the value-added tax is set to increase 13.3
\npercent to Rp 27.87 trillion from Rp 24.6 trillion in the current
\nbudget.<\/p>\n
Nontax revenue is projected to increase 74 percent to Rp 14.34
\ntrillion from Rp 8.2 trillion in the current budget because all
\ndepartmental revenue, including reforestation funds, is now
\naligned with the state budget, as required by the IMF. (rid)<\/p>\n
Table: 1997-98 state budget and revised draft 1998-99 state budget
\n(Rp billion)<\/p>\n
REVENUES 1997-98 1998-99 % change<\/p>\n
---------------------------------------------------------------<\/p>\n
A. DOMESTIC REVENUES 88,060.7 114,965.8 30.6<\/p>\n
I. Oil and natural gas 14,871.1 34,581.7 132.5<\/p>\n
1. Oil 10,688.2 24,060.9 125.1<\/p>\n
2. Natural gas 4,182.9 10,520.8 151.5<\/p>\n
II. Non-oil and non-gas 73,189.6 80,384.1 9.8<\/p>\n
1. Income tax 29,117.7 25.618.0 -12.0<\/p>\n
2. Value added tax 24,601.4 27,872.0 13.3<\/p>\n
3. Import duties 3,321.7 3,562.0 7.2<\/p>\n
4. Excise tax 4,436.3 4,922.0 10.9<\/p>\n
5. Export tax 100.0 115.0 15.0<\/p>\n
6. Property tax 2,505.0 3,411.0 36.2<\/p>\n
7. Other taxes 632.5 540.0 -14.6<\/p>\n
8. Non-tax receipts 8,225.8 14,344.1 74.4<\/p>\n
9. Fuel sales profit 249.2 0.0 -100.0<\/p>\n
B. DEVELOPMENT REVENUES 13,026.0 32,255.0 147.6<\/p>\n
I. Program aid -- 8,500.0 0.0<\/p>\n
II. Project aid 13,026.0 23,755.0 82.4<\/p>\n
---------------------------------------------------------------<\/p>\n
TOTAL 101,086.7 147,220.8 45.6<\/p>\n
EXPENDITURES 1997-98 1998-99 % change<\/p>\n
---------------------------------------------------------------<\/p>\n
A. ROUTINE EXPENDITURES 62,158.8 97,829.1 57.4<\/p>\n
I. Civil services 21,192.0 22,591.2 6.6<\/p>\n
1. Salaries\/pension 17,048.4 17,405.7 2.1<\/p>\n
2. Rice allowances 1,309.5 1,588.2 21.3<\/p>\n
3. Food allowances 1,233.7 1,484.4 20.3<\/p>\n
4. Other benefits 1,009.9 1,154.6 14.3<\/p>\n
5. Diplomat services 590.5 958.3 62.3<\/p>\n
II. Goods procurement 8,895.2 10,908.7 22.6<\/p>\n
1. Domestic 8,478.0 10,059.7 18.7<\/p>\n
2. External 417.2 849.0 103.5<\/p>\n
III. Subsidies to regions 11,535.8 12,283.9 6.5<\/p>\n
1. Personnel expenses 10,967.8 11,600.7 5.8<\/p>\n
2. Non-personnel expenses 568.0 683.2 20.3<\/p>\n
IV. Debt Service Payment 19,570.9 39,740.1 103.1<\/p>\n
1. Domestic 334.2 1,940.1 480.5<\/p>\n
2. External 19,236.7 37,800.0 96.5<\/p>\n
V. Other expenditures 964.9 12,305.2 1,175.3<\/p>\n
1. Petroleum subsidies 0.0 7,453.0 0.0<\/p>\n
2. Others 964.9 4,852.2 402.9<\/p>\n
B. DEVELOPMENT EXPENDITURES 38,927.9 49,391.7 26.9<\/p>\n
I. Rupiah financing 25,901.9 25,636.7 -1.0<\/p>\n
II. Project aid 13,026.0 23,755.0 82.4<\/p>\n
---------------------------------------------------------------<\/p>\n
TOTAL 101,086.7 147,220.8 45.6<\/p>\n
Government's savings<\/p>\n
1997\/1998 State Budget : Rp 25.90 trillion<\/p>\n
1998\/1999 State Budget Plan: Rp 17.13 trillion<\/p>\n
Editorial -- Page 4<\/p>\n
Surplus -- Page 8<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/govt-presents-revised-budget-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }