Indonesia's Tax Spinoff May Disrupt Revenue Efforts, Fitch Warns.

Fitch Ratings has warned that Prabowo Subianto's plan to create a new state revenue agency outside of Indonesia's finance ministry may harm the country's tax collection efforts. Fitch Ratings' head of Asia-Pacific Sovereigns, Thomas Rookmaaker, stated that it is unclear how this plan would improve long-term revenue collection and that it could lead to operational issues and uncertainty. Fitch suggests that the government should focus on removing tax exemptions and increasing compliance to boost revenue instead. Indonesia has struggled to raise earnings that match its economy's size, and any disruption to tax receipts could impact Prabowo's planned spending initiatives. However, Prabowo has promised not to raise tax rates while aiming to increase the tax-to-GDP ratio to 16% during his tenure. [Extracted from the article]