Page 14 - Indonesia Taxation Quarterly Report (Q2-2020)

INDONESIA TAXATION QUARTERLY REPORT Q2-2020

1 Chapter

Survey of

Recent

Developments

The third quarter of A. Macro-Fiscal Framework contrast, the World Bank projects that
2020 will be decisive Indonesia’s 2020 economy will remain
whether our economy stagnant with the growth of 0.00%
3
in a recession state The third quarter of 2020 will be while the Ministry of Finance also
or not. decisive whether our economy in a projects that Indonesia’s growth will
recession state or not. As of now,
the uncertainty remains high as the be in range between 0.00% and 0.50%
ongoing domino effect of Covid-19 for the third quarter and around 3.00%
4
pandemic has been inevitably for the fourth quarter. Conversely,
widespread. This is evidenced by within the last few years Indonesia’s
economic growth has always been
the development of health-related
root causes to social, economic, positive and in the range of 5%.
and financial problems throughout
the world. The direction of the world This crisis then has prompted the
economy has changed dramatically, government to promulgate a new
and this leads to a recession with legal standard, namely Government
unknown timeframe. Regulation in Lieu of Law No. 1 of
2020 which then was ratified by Law
Two international institutions, IMF No. 2 of 2020 as the basis for the
and OECD, project that Indonesia’s main economic policy of extraordinary
measures in addressing the pandemic.
2020 economy will be contracted by
-0.30% and -2.80% respectively. In Referring to this basis, the government
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1 IMF, “World Economic Outlook (WEO)” (June 2020), Internet, can be accessed at: https://www.imf.
org/~/media/Files/Publications/WEO/2020/Update/June/English/data/WEOJun2020update.
ashx?la=en.
2 OECD, “Economic Forecast Summary” (June 2020), Internet, can be accessed at: http://www.oecd.
org/economic-outlook/. The projected figures are projected figures within a certain scenario.
3 World Bank, Indonesia Economic Prospects: The Long Road to Recovery (July 2020), 32.
4 This information is obtained from the Ministry of Finance’s statement in KSSK Press Conference
(5 August 2020).

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