- The Indonesian government has instructed ministries, institutions, and regional governments to slash spending by around IDR 306.7 Tn (1.26% of GDP) in 2025, enough to offset the lost revenue due to the delayed VAT hike.
- Most savings are expected from reduced meeting expenses, business trips, and other activities under the management support (DukMan) programme, whose budget swelled since the pandemic.
- Rather than reducing overall spending, the cuts may aim to reallocate funds to the central government, creating fiscal space necessary to support its flagship programmes.