Mar'ie reaffirms high budget discipline<\/p>\n
SEMARANG (JP): Finance minister Mar'ie Muhammad reaffirmed
\nover the weekend the importance of maintaining a high degree of
\nbudget discipline.<\/p>\n
"Constraints on foreign loans and limited availability of
\ndomestic funds are forcing the government to strengthen its
\nbudget discipline," Mar'ie told a seminar on taxation here.<\/p>\n
He warned that Indonesia might encounter more severe financial
\nconstraints to its development projects during the current 25-
\nyear long term development plan if it could not properly mobilize
\nits potential domestic financial resources.<\/p>\n
He cited the Rp 660 trillion (US$305 billion) in new
\ninvestments needed over the next five years to generate annual
\neconomic growth of seven percent, the minimum economic expansion
\nrequired to absorb the 2.5 million new entrants into the labor
\nmarket every year.<\/p>\n
"A stringent and sound policy regarding budget management is
\ntherefore an absolute prerequisite to prevent our 'boat' from
\nsailing into a dangerous stream," he said.<\/p>\n
Mar'ie was accompanied by Tax Director General Fuad Bawazier
\nat the seminar which was organized by Diponegoro University.<\/p>\n
"The government will never hesitate to turn down projects
\nproposed by any ministries or other government agencies which do
\nnot directly support the top priority development programs," he
\nsaid.<\/p>\n
He said that ministries and other government institutions
\nshould carefully study the merits and the economic efficiency of
\nany projects they plan.<\/p>\n
"I am not referring to any specific projects but am talking
\nabout the basic economic policy which is required to manage our
\nlimited budget," he said.<\/p>\n
The mass media over the last few weeks highlighted the heated
\ndebate over budgetary allocations for the procurement of 39 used
\nwarships from Germany.<\/p>\n
"It is high time all the rank and file within the bureaucracy
\nshift their working attitude from a spending-oriented habit into
\none of revenue generating," he said in reemphasizing the urgency
\nof maintaining high budgetary and fiscal discipline.<\/p>\n
This means, Mar'ie added, high spending discipline should be
\nsupplemented by a vigorous tax collection drive to increase
\ngovernment receipts available to finance development projects.<\/p>\n
He said some Rp 40.07 trillion of the Rp 59.74 trillion in
\ninternal government revenues envisaged for the current 1994\/1995
\nfiscal year are expected from direct and indirect tax receipts
\noutside the oil sector.<\/p>\n
"It is not an easy task for us," he added.<\/p>\n
According to the 1994-1995 state budget, some Rp 18.84
\ntrillion is expected from income tax, Rp 13.23 trillion from
\nvalue added tax, Rp 3.44 trillion from import tax, Rp 2.62
\ntrillion from excise duties and Rp 1.62 trillion from property
\ntax.<\/p>\n
Mar'ie said the government therefore will continue to broaden
\nthe tax base and intensify tax collection.<\/p>\n
Citing an example of the tax efforts to be stepped up, the tax
\ndirector general said that he will set up a tax office in the
\nJakarta Stock Exchange to secure the collection of taxes due from
\ntransactions. (fhp)<\/p>",
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