Indonesia's Debt Rises, DPR Warns Government to Boost Tax Revenue
Jakarta, CNBC Indonesia - The Chairman of DPR Commission XI, Mukhamad Misbakhun, has warned the government to boost state revenues, particularly from taxes, to offset the continuously rising debt levels year on year.
He stated that increasing tax revenues is crucial to maintaining the government’s debt repayment capacity ratio from the tax receipts side, namely the debt service ratio (DSR). According to him, the current DSR level is not yet ideal.
“The issue now is what percentage is our debt service ratio? Our tax revenues for repayment are in a less than ideal situation,” said Misbakhun on the CNBC Indonesia TV programme, quoted on Tuesday (28/4/2026).
Based on CNBC Indonesia’s research team records, the government’s DSR stood at 42.3% in 2024. This means that out of every 100 rupiah in state income, approximately 42 rupiah is used to pay debt obligations. Meanwhile, the ideal level is around 20%-30% as a safe threshold.
Nevertheless, Misbakhun stressed that debt is an inevitability for any government to sustain development capacity. Therefore, the government does need to borrow, as Indonesia currently has recorded public debt in the state budget amounting to Rp 9,637.9 trillion by the end of Q4 2025.
That debt figure is equivalent to 40.46% of Gross Domestic Product (GDP), up from 40.30% in Q3 2025 with a nominal value of Rp 9,408.64 trillion.
“Like in any household, it’s impossible to buy a car with cash. It’s impossible to buy a house with cash. It’s impossible to buy property with cash. There is a financial system that allows us to own them gradually,” he explained.
He also emphasised that no country in the world is without debt, and Indonesia is no exception, although it has never been even a second late in meeting its obligations to lenders, whether in the form of government bonds or loans.
“And Indonesia is a country that, to this day, is very disciplined in paying its debts along with the interest. To date, the Republic of Indonesia has never defaulted. Not even rescheduling debt. The government has never been even a second late in paying debt interest,” Misbakhun asserted firmly.
The government debt that has accumulated so far, according to him, has proven to be utilised to keep the wheels of the economy turning, particularly in relation to nation-building in line with the increasing capacity of the state budget.
“In the past, our state budget was Rp 1,000 trillion, perhaps our debt was around a hundred trillion. Now, when our state budget is five times larger and perhaps already Rp 3,800 trillion, of course the value will increase. But in terms of percentage, it is still very regulated,” said Misbakhun.
“Why? Because the large state budget also impacts the addition of our GDP volume; our productivity increases. What does that mean? That we are adding debt but also adding productivity in the economic sector,” he stressed.