Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan said that the government is targeting tightening the use of fuel subsidies on August 17, so that it can reduce the amount of subsidies distributed to people who are not entitled.
“The provision of inappropriate subsidies. Pertamina has now prepared for that. We hope that on August 17, we can start, where we can reduce the number of people who are not entitled to subsidies,” said Luhut as quoted via his official Instagram account, luhut.pandjaitan, which was monitored from Jakarta, Tuesday (9/7).
He made the statement when discussing the problem of gasoline use related to the 2024 State Budget deficit. He believes that by tightening subsidy recipients, the government can save the 2024 State Budget.
In addition to tightening the distribution of subsidized fuel, Luhut also revealed that the government is planning to encourage alternatives to gasoline through bioethanol.
Luhut believes that the use of bioethanol is not only able to reduce air pollution levels. The sulfur levels of this alternative fuel are also relatively low. “That will reduce people who are sick with ISPA (Acute Respiratory Infection),” said Luhut.
If Indonesia succeeds in reducing sulfur levels by using bioethanol, Luhut believes the number of ISPA sufferers can be reduced and BPJS payments for the disease can save the APBN. “It can also save up to Rp38 trillion,” he said.
Also read: Ensure that subsidies are right on target, socialization and coordination must be intensified
Luhut reminded that the 2024 APBN deficit is projected to be larger than the set target.
The state budget deficit is a challenge for the government in maintaining financial stability and balance of the state budget, he said.
Previously, Finance Minister Sri Mulyani Indrawati reported that the state budget (APBN) experienced a deficit of IDR 77.3 trillion or 0.34% of gross domestic product (GDP) in the first semester of 2024.
“As of semester I-2024, the APBN deficit is still maintained at IDR 77.3 trillion or 0.34% of GDP, with the primary balance still recording a surplus of IDR 162.7 trillion,” said Sri Mulyani during a Working Meeting with the DPR Budget Agency (Banggar) in Jakarta, Monday (8/7).
State revenue in the first semester of 2024 was recorded at IDR1,320.7 trillion or contracted by 6.2% (year-on-year/yoy). Tax revenue was recorded at only IDR1,028 trillion, down 7% compared to the same period last year.
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