"We can maintain the deficit at no more than 2.38 percent or even lower than that," the head of the Finance Ministry`s Fiscal Policy Board, Bambang Brodjonegoro, said.Jakarta (ANTARA News) - The Finance Ministry has predicted that the country`s budget deficit this year may stay below the target of 2.38 percent of the gross domestic product (GDP).
"We can maintain the deficit at no more than 2.38 percent or even lower than that," the head of the Finance Ministry`s Fiscal Policy Board, Bambang Brodjonegoro, said here on Friday.
The forecast is based on low tax receipts and budget absorption expected to reach 90 percent of the target, he said.
Tax receipts are projected to fall short of target after the prices of mineral commodities dropped due to low demand in developed nations, he said.
"The tax receipts mostly come from corporate taxes. Much of the corporate taxes come from companies focusing on exporting raw materials. Now that the prices of raw materials are declining the profit of the companies will drop accordingly," he said.
He said state spending on goods and capital goods will not reach 90 percent of the budget ceiling as the figure was only recorded at 30 percent at the end of August.
However, state spending on energy subsidies rose slightly from the budget ceiling of Rp299.8 trillion in the revised 2013 state budget.
According to the Finance Ministry, the budget deficit reached Rp100.8 trillion or 45 percent of the target of Rp224.2 trillion or 2,38 percent of the GDP as of August 30, 2013.
Meanwhile, state spending reached Rp945.8 trillion or 54.8 percent of the budget ceiling of Rp1,726.2 trillion, and state income and grants reached Rp844.9 trillion or 56.3 percent of the target of Rp1,502 trillion.(*)
Editor: Heru Purwanto
Copyright © ANTARA 2013
