Well-Targeted Subsidies should Become the Government's Focus
To maintain the function of the state budget as an economic shock absorber in a sustainable manner, policy makers need to adjust fuel prices while making sure that subsidized fuel reaches targeted recipients.
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Dozens of trucks line up to buy diesel fuel at a gas station (SPBU) on South Ring Road, Gambut District, Banjar, South Kalimantan, Tuesday (30/8/2022). Long queues of diesel buyers are becoming increasingly common at several gas stations before the implementation of the Government's plan to increase the price of subsidized fuel.
JAKARTA, KOMPAS — Raising the subsidy spending in order to maintain the prices of subsidized fuel will further burden the 2023 state budget. To maintain the function of the state budget as an economic shock absorber in a sustainable manner, policy makers need to adjust fuel prices while making sure that subsidized fuel reaches targeted recipients.
During a plenary session to respond to the House of Representatives’ general assessment on the proposed 2023 State Budget in Jakarta on Tuesday (Aug. 30), Finance Minister Sri Mulyani reiterated that if the prices of subsidized fuel were not increased, the fuel subsidies would further burden the state budget next year.