Map of Financial Capabilities of the Provincial Region in Indonesia

Abstract

This study aims to map the financial capabilities of provinces in Indonesia which are divided into five regions: 1. Java and Bali, 2. Sumatra, 3. Kalimantan, 4. Sulawesi, 5. Nusa Tenggara, Maluku and Papua. The provincial financial capability is measured by the amount of revenue and growth in local income, income and growth, and the contribution of local income to total revenue. The population in this study covers all provinces in Indonesia, amounting to 34 provinces with census data collection. The observation period from 2013 to 2015. Data analysis was carried out descriptively which included growth, contribution and source of local revenue. The results showed that there was an increase in provincial financial capacity in Indonesia as indicated by an increase in income from 2013 to 2015. The average province in the Java and Bali regions had the largest income compared to provinces in other countries. area. The next largest average income is Sumatra, Kalimantan. For 2013 and 2014 provinces in the Sulawesi region had greater average income from the Nusa Tenggara, Maluku and Papua regions. But in 2015 provinces in the Nusa Tenggara, Maluku and Papua regions were higher than the provincial income average in the Sulawesi region. Overall, provincial income in Indonesia shows an increase from year to year and its contribution to total income. On average in three years, the contribution of regional income to total provincial income in Indonesia is still low, even in 2015 there were still provinces which were categorized as very low (less than 25 percent), namely Maluku, North Maluku, Papua and West Papua. While those who have obtained a high category are only 1 province, namely DKI Jakarta.

Provincial Tax Map in Indonesia

“…The increase in the financial capacity of the province by measuring independence as measured by comparing the original regional income with the total regional income is thought to be due to additional provincial revenues in the form of cigarette taxes that took effect in 2014. On average, the independence of the provinces in Indonesia in 2013 was around 35 percent and in 2014 and 2015 to around 40 percent [1]. With the additional types of local taxes in the form of cigarette taxes, provincial financial performance will be better because dependence on certain types of local taxes will be reduced.…”