Indonesia Budget Deficit Widens as JCI Retreats After Intraday Record
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JAKARTA, Investortrust.id — Indonesia’s 2025 state budget deficit widened to 2.92 percent of GDP on Thursday, Jan 8, 2026 in Jakarta as weaker tax revenue pushed the gap beyond the government’s outlook, a development that coincided with a retreat in the Jakarta Composite Index after it briefly touched a new all time high. The deficit reached Rp 695.1 trillion, exceeding the earlier outlook of 2.78 percent of GDP and the initial budget target of 2.53 percent.
Finance Minister Purbaya Yudhi Sadewa said the wider deficit reflected revenue pressures during a volatile global environment, while fiscal policy was deliberately kept expansionary and counter cyclical. He said the deficit would still be maintained below the statutory ceiling of 3 percent of GDP.
According to the presentation, state revenue reached Rp 2,756.3 trillion, equal to 91.7 percent of the full year target. Tax revenue totaled Rp 1,917.6 trillion, or 87.6 percent of target, while customs and excise receipts reached Rp 300.3 trillion, close to target.
Non tax state revenue amounted to Rp 534.1 trillion, equivalent to 104 percent of target, while grants reached Rp 4.3 trillion, far above initial assumptions. On the spending side, total expenditure reached Rp 3,451.4 trillion, or 95.3 percent of target.
Central government spending stood at Rp 2,602.3 trillion, with ministry and agency spending overshooting the target at Rp 1,500.4 trillion, while non ministry spending lagged behind at Rp 1,102 trillion. Purbaya said the spending stance was aimed at cushioning the economy rather than aggressively narrowing the deficit.
“I could make the deficit zero by cutting the budget, but the economy would suffer,” he said.
Market reaction remained cautious following the announcement, with the Jakarta Composite Index on the Indonesia Stock Exchange closing down 0.22 percent at 8,925 after earlier surging to an intraday record of 9,002. The pullback reflected sector wide weakness despite the fiscal reassurance that the deficit would remain below 3 percent of GDP.