Standard Chartered forecasts a higher 2.9% deficit for 2027, citing risks from ambitious tax revenue assumptions and lower commodity prices.
Indonesia’s 2027 fiscal plan targets a deficit of 2.4% of GDP, down from 2.9% in 2026, aiming to stay below the 3% legal threshold. The budget prioritizes food, energy, education, and defense sectors, alongside state-owned enterprise restructuring and private investment in downstream and renewable industries.
Tax revenue growth is projected at 12% in 2027, following a 21% target in 2026. Analysts warn of potential shortfalls due to lower commodity prices, with Brent crude forecasted at USD 75 per barrel in 2027 versus USD 89 year-to-date in 2026. A higher tax base effect and uneven growth drivers may also strain revenue.
Despite the narrower deficit target, financing needs are expected to rise in 2027 due to higher debt maturities. The fiscal buffer remains adequate to keep the deficit below 3%, though risks persist from revenue assumptions.