Rupiah Plummets: What Will Become the Pillar of National Strength?

Recently, the movement of the rupiah exchange rate amidst global economic instability has once again drawn public attention. The weakening of the rupiah is accompanied by growing public concerns, which are not far from rising goods prices, the cost of living, and the comfort of future economic conditions. Most people might consider this exchange rate increase to feel distant from daily life. However, in reality, global economic changes can be directly felt in people’s lives and the state’s ability to run various public programmes.

Amidst such a situation, public attention often stops at one question: how to keep the rupiah stable? And often forgets another question that is no less important to consider, namely how ready the state is to sustain development and meet the people’s needs when economic pressures come repeatedly.

The answer to that question points to fiscal resilience. Simply put, fiscal resilience is part of the state’s capability to maintain its financing condition so that it can continue to perform public functions well even though global economic conditions are unstable. This resilience is an important foundation because it is directly related to the financing of education, health services, infrastructure development, and various social programmes needed by the community.

In this regard, state revenue plays a very important role. One of the most sustainable sources of revenue comes from taxes. However, the current challenge is no longer just how to increase tax revenue, but how to build a revenue system that is strong, sustainable, and fair amidst increasingly rapid economic reforms.

Broadening the tax base is one concrete step that can be taken in an effort to answer the above question. Unfortunately, this term is often misunderstood as an effort to raise rates, thus making people pay more taxes. In fact, the basic essence of the tax base itself does not mean adding to the people’s burden. The main idea is to expand the scope of economic activities that are recorded and integrated into the taxation system so that contributions to state revenue can take place more evenly and with justice.

Not only related to increasing the number of registered taxpayers, broadening the tax base also includes efforts to build a system capable of reaching economic activities more widely and accurately. This step can be taken through improving data integration, strengthening tax administration, and adjusting policies to the emergence of new business models and income sources that are increasingly developing. With a system that records economic activity better, the potential for state revenue can be obtained from more equitable contributions, rather than burdening certain groups that have been compliant all along. Over a longer period, this approach can also increase voluntary compliance because the public sees a fairer and more equal system.

The current changes in economic patterns also make this step increasingly relevant. Economic activity is growing rapidly through various new forms and sectors that continue to emerge. Along with these developments, the taxation system must also be able to keep up with these changes so that state revenue does not only rely on groups that have been compliant in paying taxes.

Let us analogise the state as a classroom and tax as the class fund contribution. Imagine a class fund contribution that has mostly been given by the same people. When the class’s needs increase, the fair solution is not to ask that group to pay more, but to ensure more class members contribute according to their capacity. A similar principle can also be applied in the taxation system.

The importance of broadening the tax base as a strategy towards an Indonesia with strong fiscal resilience. The goal is not merely to increase the state revenue figure, but also to create a healthy and sustainable system. With a broadened tax base, the state will have greater and stronger fiscal space to continue financing the people’s needs without placing unfair pressure on groups that have so far fulfilled their tax obligations.

However, the scope of the tax base must be balanced with public trust. A good tax system does not only rely on the ability to collect taxes, but must also be able to present a sense of justice. The public also needs to see that the contributions given will truly return in the form of quality public services and tangible development.

Ultimately, the weakening of the rupiah and various global economic upheavals serve as a reminder that economic strength is not built solely through short-term responses. The stability of the rupiah exchange rate is indeed important, but the state’s ability to continue financing the people’s needs is a foundation that is no less important. In an increasingly difficult world, broadening the tax base does not mean asking people to pay more. Rather, it is about strengthening the foundation of state revenue so that Indonesia becomes stronger, fairer, and ready to face future challenges.