By Asia News Network
Indonesian President Joko Widodo is eyeing 12.9 percent growth in government revenue to 2.14 quadrillion rupiah (US$146.5 billion) in his final year in office.
Jokowi announced the target during his speech to reveal the 2019 state budget bill in the plenary session of the House of Representatives on Thursday.
The government continues to pin a lot of hope on tax revenue as it represents more than 80 percent of the target at 1.78 quadrillion rupiah .
Meanwhile, non-tax revenue is projected to stand at 361.1 trillion rupiah, while the contribution of grants will be 400 billion rupiah.
“The increasing role of tax in the funding of the state budget is in line with the government’s efforts to improve tax performance,” the president said in his speech.
The government will continue to push tax reforms and tax incentives, Jokowi said, mentioning a number of possible policies like tax holidays and tax deductions for strategic sectors.
With such policies, the 2019 tax ratio is expected to stand at 12.1 per cent of GDP, up from this year’s projection of 11.6 per cent. – The Jakarta Post
Malaysia’s 2Q GDP at 4.5%, below consensus estimates
Economic growth for Malaysia in the second quarter of this year came in at 4.5 per cent, which was below the consensus estimates of more than 5 per cent.
According to Bank Negara Malaysia, supply disruptions in the second quarter resulted in the slower economic growth.
In comparison, GDP growth was 5.8 per centin the corresponding quarter of 2017 and 5.4 per cent in 1Q 2018.
In the breakdown of GDP by economic activity, the services, manufacturing and construction sectors showed growth in the second quarter while the agriculture and mining sectors of the economy went into a decline.
The services sector showed slightly improved growth with 6.5 per cent recorded in 2Q 2018 as compared to 6.3 per cent in 2Q 2017.
Growth in the manufacturing sector was recorded at 4.9 per cent, a 1.1 percentage point drop from 6 per cent in the same quarter in 2017.
Mining, which contracted 2.2 per cent, fared poorer compared to a 0.1 per cent expansion in 2Q 2017. – The Star
Businesses call for role in drafting import limitation rule
Businesspeople in Indonesia have called on the government to involve them in drafting a regulation on import limitation of raw materials to ease the country's current account deficit (CAD) because many of their factories still rely on imported raw materials.
In an effort to curb imports, the government plans to issue a regulation that among others will impose a 7.5 percent income tariff on imports of consumer goods and raw materials. The government is currently assessing 500 imported items that may be replaced by local products.
Association of the Indonesian Food & Beverage Producers (GAPMI) secretary-general Adhi Lukman said the import limitation of raw material was counterproductive.
“The industry also needs a global value chain. If the import is limited, we will also limit the products,” Adhi said as quoted by kontan.co.id. on Wednesday, adding that such limitation should be only imposed on finished goods. He called on the government to be careful in drafting a regulation on import limitation because it could hamper investment and the business climate. – The Jakarta Post
More rate hikes likely as Philippine inflation peaks
Inflation will like get worse over the next two months, the Bangko Sentral ng Pilipinas warned, but noted that relief from the unrelenting price hikes since the start of this year might finally be in sight for suffering Filipino consumers by the fourth quarter.
Speaking at a media forum, BSP Governor Nestor Espenilla Jr. said that central bank economists expected the pace of consumer price increases to peak in the months of August or September ahead of the expected normalization to the 2-4 percent range by 2019.
“Based on our assessment, the August inflation number may be higher than the July number,” he said, adding that the consumer price index would likely be “close” to the previous month’s number.
“The peak will probably be either in August or September, before it starts coming down,” he said. - Philippine Daily Inquirer