Economic Stimulus Government Solution to Maintain People’s Purchasing Power

Jakarta – Director of Counseling, Services, and Public Relations, Directorate General of Taxes (Ditejen Pajak), Dwi Astuti said, the results of the VAT rate adjustment policy will return to the people in various forms.

“Among them are Direct Cash Assistance (BLT), Family Hope Program (PKH), Food Card, Smart Indonesia Program (PIP) and Smart Indonesia Card (KIP) for College. Also electricity subsidies, 3 kg LPG subsidies, fuel subsidies, and fertilizer subsidies,” said Dwi.

Strategic steps have been taken by the government to protect economic stability and maintain the purchasing power of people from the middle to lower classes. A series of economic stimulus programs implemented aim to ensure economic stability at the regional and national levels.

Coordinating Minister for Economic Affairs, Airlangga Hartarto said, the government launched an economic policy package through various stimuli to maintain people’s purchasing power, especially the household sector which plays a major role in national economic growth.

“Until the end of 2024, economic growth is still maintained at an average of 5%. Household consumption contributes more than 50% of the Indonesian economy and is growing strongly, and is expected to grow above 5%,” explained Airlangga.

On the other hand, Minister of Finance, Sri Mulyani Indrawati explained, the Government is trying to maintain the purchasing power of lower-middle income people through incentives.

“We designed this economic policy stimulus package by considering in a balanced way, the demand side, especially the lower middle class, whose protection and even assistance are still maximized,” said Finance Minister Mulyani Indrawati.

The government’s economic stimulus package for the community includes food/rice assistance for two months from January to February 2025 for 16 million Food Assistance Recipients (PBP) by receiving 10 kg per month, government-borne value added tax (PPN DTP) of 1% for wheat flour, industrial sugar, and subsidized oil (Minyakita), easy access to Job Loss Insurance (JKP) for workers who are laid off, extension of the validity period of the final income tax (PPh) of 0.5%.

“For the housing sector, VAT DTP is given for home purchases because this is a sector that, in addition to meeting the needs of the community, also has a multiplier and creates large job opportunities,” said Sri Mulyani.

Meanwhile, PT PLN (Persero) fully supports the Government’s steps in distributing economic stimulus packages for 81.4 million customers or 97 percent of the total 84 million household customers.

PLN President Director, Darmawan Prasodjo stated that PLN fully supports the policy and ensures that the electricity discount distribution mechanism runs on target and without going through a registration process.

“For postpaid customers, the monthly bill will be automatically reduced by 50% when paying for electricity. While for prepaid customers, a 50% discount will be immediately obtained when customers buy electricity tokens anywhere, be it at PLN Mobile, at retailers, at agents, and anywhere,” explained Darmawan.

The government is making optimal efforts to prevent economic shocks and weakening purchasing power of the middle to lower classes. Various stimulus policies issued by the government are expected to maintain economic stability both locally and nationally.

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