Page 14 - Indonesia Taxation Quarterly Report (Q1-2020)

INDONESIA TAXATION QUARTERLY REPORT Q1-2020

Chapter
Survey of

Recent

1 Developments

The COVID-19 A. Macro-Fiscal Framework assuming that the rupiah exchange rate
outbreak in the first is in the range of Rp15,000/USD. As it
quarter of 2020 has now stands, Bank Indonesia has revised
affected the overall The COVID-19 outbreak in the first the projection of Indonesia’s 2020
Indonesia’s economy quarter of 2020 has affected the overall economic growth, i.e. 4.2% to 4.6% while
as it disrupts Indonesia’s economy as it disrupts in February, the 2020 economic growth
investors’ trust, the investors’ trust, the financial market, was projected at 5.0% to 5.4% following
financial market, the the tourism/travel sector and the the estimation in January of 5.1% to
tourism/travel sector distribution chain. As it takes place 5.5%.
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and the distribution almost all over the world, the IMF has
chain. officially announced on 27 March 2020 The Ministry of Finance outlines the
that the world is on the brink of a global
recession that jeopardizes economic outlook scenario for macroeconomic
activities in countries affected by the key indicators consisting of the growth
COVID-19. 1 of Gross Domestic Product (GDP),
Indonesian Crude Price (ICP), the
exchange rate of the rupiah against the
Previously, prior to the outbreak of the US dollar, and inflation. For the base-case
COVID-19 virus, the OECD predicted scenario, GDP growth is predicted to be
that Indonesia’s 2020 economic growth 2.3% yoy, ICP prices of 38 US dollars/
would stay level at 5% in the “November barrel, rupiah exchange rates of 17,500
2019 OECD Economic Outlook”. rupiahs/US dollar, and inflation by 3.9%.
2
The inflation target for 2020 is 2-4%, As for the worst-case scenario, GDP

1 International Monetary Fund – IMF, “Opening Remarks at a Press Briefing by Kristalina Georgieva
following a Conference Call of the International Monetary and Financial Committee (IMFC).
Internet, can be accessed at: https://www.imf.org/en/News/Articles/2020/03/27/sp032720-
opening-remarks-at-press-briefing-following-imfc-conference-call.
2 OECD. Internet, can be accessed at: http://www.oecd.org/economic-outlook/november-2019/.
3 Central Bank of Indonesia – BI, “Tinjauan Kebijakan Moneter Maret 2020”. Internet, can be
accessedat: https://www.bi.go.id/id/publikasi/kebijakan-moneter/tinjauan/Pages/Tinjauan-
Kebijakan-Moneter-Maret-2020.aspx.

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