Muhammad Rafi Bakri

Indonesia’s flash floods in Sumatra are not merely natural disasters; they are also symptomatic of fiscal failure. While rescue teams battled torrents of mud, a quieter tragedy unfolded in the budget books. Disaster mitigation funding was systematically crowded out by competing political agendas. It signals a concerning reality that, within Indonesia’s current fiscal hierarchy, resilience appears expendable until a disaster hits. The crisis extends far beyond emergency response budgets.

Introduction Stepping into 2025 means we only have less than five years left to achieve the ambitious targets of the SDGs. With so many uncertainties, a question remains: Can we really meet these goals or will we fall short doing so, thus leaving humanity to face the consequences of inaction? To recapitulate, the world is drastically off course in achieving the 2030 target.

As the sun sets on 2024, the Indonesian government charts a new fiscal course by raising the Value Added Tax (VAT) rate to 12 percent that effective on January 1, 2025. Framed as the torchbearer of the Tax Harmonization Law’s (UU HPP) mandate, this increase is seen as a lifeline for a tax ratio struggling to stay afloat. This decision signals a bold yet controversial attempt to navigate through the nation’s growing budget needs.