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Indonesia to support economy with 120t rupiah stimulus to counter virus impact

[JAKARTA] The Indonesian government has prepared a 120 trillion rupiah (S$11.4 billion) stimulus package to support Southeast Asia's biggest economy as the spread of coronavirus disrupts global activities, the country's finance minister said.

The stimulus, representing 0.8 per cent of gross domestic product, includes exempting workers in manufacturing from income tax and giving manufacturing companies a 30 per cent discount on corporate tax payments, both measures to take effect starting April for six months, Minister Sri Mulyani Indrawati told a news conference.

She said the budget deficit this year was expected to widen to 2.5 per cent of GDP, from an initial plan to keep it around 1.8 per cent.

In addition, rules on loan restructuring for small and medium companies will be relaxed so that banks can start restructuring regardless of loan size, Financial Services Authority chief Wimboh Santoso said.