An encouraging macro-economic picture has emerged for the country, with the US dollar exchange rate stabilizing in the past 12 months at an average of US$1:13,400 rupiah and a cut in the basic lending from 7.5% to 6.5% by the central bank bringing in cheaper borrowing.

In May, inflation hit a historic low of 3.3% year on year. The country has seen a trade surplus of US$6.4 billion over the past year, with foreign exchange reserves maintained at US$103 billion. The government has put forward a tax amnesty bill, whereby tax evaders can declare and repatriate funds, and income tax on those assets is cut to 2% during the time the amnesty bill is in force.

Normal income tax rates in Indonesia can reach 25%. Passing the bill could lead to a substantial cash inflow of trillions of rupiah and provide additional resources for major infrastructure work, such as an underground train system, railways and harbor improvements. Political deliberations between the government and the House of Representatives (DPR) are set to conclude by the end of July.

Government estimates suggest that the first months after passing the bill could see 1,000 trillion rupiah (around US$76 billion) return to the country. The additional funds would be especially useful given that the government slashed the state budget by US$6.5 billion in May due to expectations of lower tax collection, lower crude oil prices and less oil and gas production. It also revised its economic forecast for 2017 downward to 5.3%-5.9% year on year.

The initial projection had expected GDP growth to reach 5.5%-5.9%. Indonesia’s food and drug monitoring agency, known as BPOM, has discouraged people from buying prescription medicines from online stores. BPOM is working with other government bodies to regulate this area. Head of the organization Dr. Roy Alexander Sparringa said it was harder to supervise online trading than conventional stores and strict regulation was necessary across government agencies.