THE Indonesia’s Government (RI Government) finally provided a stimulus to reduce the corona virus effect which was feared would undermine economic growth. What are the stimulus provided by the government?
The RI government recognizes that the impact of the corona virus or Covid-19 will hit the Indonesian economy. Therefore, President Joko Widodo has allocated a budget of Rp10.3 trillion to realize a policy package to minimize slowing economic growth.
“Especially to anticipate related to the tourism industry and the decline in tourists due to corona and also related to how to create a stimulus so that people’s purchasing power can survive,” said Coordinating Minister for the Economy Airlangga Hartarto after a limited meeting about the impact of Covid-19 on the Indonesian economy in the Presidential Palace complex, Jakarta.
The government, among others, will provide additional money to beneficiary families by 30% to IDR200,000. The policy absorbs 44% of the total budget allocation for incentives. The increase is valid for 6 months and will begin as of March 2020.
In addition, the government also increased the quota for subsidized houses by 175,000 units, to 330,000 units. Airlangga explained that related to this the government added a budget requirement of IDR1.5 trillion. A total of IDR800 billion will be used for interest subsidies and IDR700 billion in the form of a down payment subsidy.
Interest subsidies will make consumers pay mortgage interest of 5% for 10 years. He hopes this will trigger a positive impact on 174 sectors related to housing.
Meanwhile Finance Minister Sri Mulyani Indrawati explained that subsidized houses were the focus of the government so consumers could absorb the stock of houses that had been built. With this subsidy, the government hopes to be able to spend the old stock and bring up new stock.
“Meanwhile, related to the tourism sector, the government is preparing incentives for foreign flights, subsidizing domestic airplane tickets, and also hotel and restaurant tax exemptions. We hope this will be able to stimulate the tourism area and community economic activities,” Sri Mulyani said.
Furthermore, subsidies to domestic flights will be given in the form of a 30% ticket discount. This will apply to 10 tourist destinations that apply from March 2020 to May 2020.
The intended tourist destinations are Lake Toba in North Sumatra, DI Yogyakarta, Malang in East Java, Manado in North Sulawesi, Bali, Mandalika in West Nusa Tenggara, Labuan Bajo in East Nusa Tenggara, Bangka Belitung, and Batam and Bintan in Riau Islands.
The final technique is hotel and restaurant tax exemption in the 10 tourist destinations. In this regard the government is preparing a grant which will be given by the central government to the regional government in the amount of IDR3.3 trillion for 33 districts and cities.
Minister of Finance explained that the hotel and restaurant tax is a source of local revenue (PAD). Grants from the central government ensure that the region does not lose main income.
All the additional budget, said Sri Mulyani, came from the reserve post which was intended to finance something unplanned. Is it for disaster or responding to conditions that occur as it is today. [antaranews/photo special]