Jakarta. Indonesia recorded a state budget deficit of Rp196.5 trillion ($10.95 billion) in the first half of 2026, equivalent to 0.76% of gross domestic product (GDP), as government spending outpaced revenue, Finance Minister Purbaya Yudhi Sadewa said on Tuesday.

The government collected Rp1,459.4 trillion in state revenue during the January–June period, while total spending reached Rp1,656 trillion.

Purbaya told lawmakers that the deficit remained "within a safe and manageable range," underscoring the government's commitment to maintaining fiscal discipline.

State revenue reached 46.3% of the full-year target of Rp3,153.6 trillion, rising 21.4% from the same period a year earlier. Tax revenue contributed Rp1,035.7 trillion, up 24.6% year-on-year, while customs and excise receipts totaled Rp152 trillion, an increase of 3.4%. Non-tax state revenue (PNBP) reached Rp271 trillion, up 21.6%, and grant income amounted to Rp700 billion.

Purbaya attributed the stronger revenue performance to improving economic activity, tighter tax and customs administration, and better public service management.

"The 24.6% growth in tax revenue is encouraging, especially after a 7% contraction in the first half of last year. Tax administration reforms are beginning to deliver promising results," he said.

Meanwhile, state spending reached 43.1% of the full-year allocation of Rp3,842.7 trillion, increasing 17.8% from a year earlier. Central government expenditure totaled Rp1,298.6 trillion, while transfers to regional governments stood at Rp357.4 trillion, down 11.2% year-on-year.

Purbaya said the stronger spending realization reflected efforts to distribute government expenditure more evenly throughout the year, with spending aimed at supporting economic growth, development priorities, and national flagship programs.

Separately, the government and the House of Representatives have agreed to target a 2027 state budget deficit in the range of 1.8%-2.4% of GDP.

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