JAKARTA. The expert in the Center of Reform on Economics (CORE), Yusuf Rendy Manilet, projects that the extended Community Activities Restriction Enforcement (PPKM) would impact the declining tax revenue and potentially induce a shortfall.
“The said policy would limit the public’s mobility in performing economic activities, leading towards the possible decrease in tax revenue,” Manilet further elaborated during the virtual CORE Midyear Review 2021 this week.
According to Manilet, just as during the Large-Scale Social Distancing (PSBB) in 2020, Level 3 and 4 PPKM in several zones would cause the tax revenue to be corrected by the end of 2021. Based on the data of the Ministry of Finance that he observes, Manilet records quite a significant contraction in tax revenue growth within the manufacturing, trading, and financial services sectors throughout PSBB in 2020 and PPKM in 2021.
“Thus, the shortfall may reoccur. Moreover, considering that the tax revenue in each sector still contracts quite severely when the government imposes the community mobility restriction,” Manilet adds. (AM/ZH)