Stimulus or Enforcement? How Intergovernmental Transfers Crowd-in Local Taxes in Indonesia

IF 0.5 Q4 ECONOMICS

PUBLIC FINANCE REVIEW Pub Date : 2023-09-01 DOI:10.1177/10911421231191961

Prianto Budi Saptono, Gustofan Mahmud

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引用次数: 1

Abstract

This study quantifies intergovernmental transfers’ contemporaneous and lagged effects on local tax revenues of districts/municipalities in Indonesia. This study found that transfer as aggregate and unconditional transfers/ Dana Alokasi Umum have crowding-in effects on local tax revenues. Meanwhile, revenue sharing/ Dana Bagi Hasil and conditional transfers/ Dana Alokasi Khusus do not significantly affect the tax revenues of districts/municipalities. In addition, system-Generalized Method of Moments estimation results show that the contemporaneous effects of transfers are more prominent in magnitude than their lagged effects. It indicates that local tax enforcement due to transfers provides a larger portion than the local spending stimulus in determining local revenue increases. Our findings refute the negative stigma that emerged after implementing fiscal decentralization, particularly related to the disincentive effect of transfers on local government efforts to generate their revenues. Therefore, equitably endowing local governments with intergovernmental transfers will improve their accountability and build public trust.

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刺激还是强制?政府间转移支付如何挤占印尼地方税

本研究量化了政府间转移对印度尼西亚各地区/市政府地方税收收入的同期和滞后影响。这项研究发现，作为累计和无条件转移/Dana Alokasi Umum的转移对地方税收有挤入效应。同时，收入分享/Dana Bagi Hasil和有条件转移/Dana Alokasi Khusus不会对地区/市政府的税收产生重大影响。此外，系统广义矩量法估计结果表明，转移的同期效应比滞后效应在幅度上更为突出。它表明，在决定地方收入增长方面，由于转移而产生的地方税收执法比地方支出刺激提供了更大的份额。我们的研究结果驳斥了在实施财政权力下放后出现的负面污名，特别是与转移支付对地方政府创收的抑制作用有关。因此，公平地向地方政府提供政府间转移将提高其问责制并建立公众信任。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

PUBLIC FINANCE REVIEW ECONOMICS-

CiteScore

1.30

自引率

0.00%

发文量

期刊介绍： Public Finance Review is a professional forum devoted to US policy-oriented economic research and theory, which focuses on a variety of allocation, distribution and stabilization functions within the public-sector economy. Economists, policy makers, political scientists, and researchers all rely on Public Finance Review, to bring them the most up-to-date information on the ever changing US public finance system, and to help them put policies and research into action. Public Finance Review not only presents rigorous empirical and theoretical papers on public economic policies, but also examines and critiques their impact and consequences. The journal analyzes the nature and function of evolving US governmental fiscal policies at the national, state and local levels.