Economic Slowdown, Tax Revenue Affected

JAKARTA. Tax revenue realization until February 2024 contracted by 3.9% year on year compared to the same period in 2023. This is due to the fact that economic activity in early 2024 is still moving slowly.

According to Executive Director of MUC Tax Research Institute Wahyu Nuryanto, as quoted by Kontan.co.id, the slowdown in economic activity can be seen from the negative performance of Corporate Income Tax and Domestic Value Added Tax (VAT) revenues.

Corporate Income Tax revenue in February was recorded to grow minus 10.7% from IDR 42.17 trillion in February 2023 to only IDR 37.66 trillion in February 2024.  Meanwhile, domestic VAT revenue grew minus 24.83% from IDR 83.31 trillion in 2023 to only IDR 62.62 trillion in February 2024.

Not only did it contract, but the portion of revenue contributed by the two types of taxes also shrank. 

However, Wahyu is optimistic that this slowing trend will improve. This is because there is an improvement if viewing the revenue performance between January 2024 and February 2024. 

Therefore, Wahyu assesses that this improvement momentum must be maintained. The condition is that the government must be able to maintain economic stability, especially controlling the rate of price increases that can affect people's purchasing power. (ASP/KEN)