Indonesian Treasury Review: Jurnal Perbendaharaan, Keuangan Negara dan Kebijakan Publik

Are Monetary and Fiscal Policies Effective in Controlling Budget Deficits?

Rachmawaty Rachmawaty — 2024-12-20

The state budget's countercyclical policy and government revenue imbalance to support government expenses caused Indonesia to experience a budget deficit for years. Understanding the correlation between monetary and fiscal policies helps policy makers formulate effective strategies to control and manage budget deficits. The research’s novelty is the complexity variable, which consists of three variable classifications. The first is monetary policy ( interest rates and money supply), the second is fiscal policy (government revenue and expenses), and the third is macroeconomic variables: economic growth, inflation, and exchange rate. All data is processed using the VAR/VECM in EVIEWS 9. The finding is that fiscal policy consists of controlling revenue and expenses, giving 37.6% contribution; monetary policy consists of the number of broad money and BI Rate give 7.6% contribution; macroeconomic factor consists of exchange rate, inflation and economic growth, giving contribution 41.6% while the effect of budget deficit itself has contribution 13.2%. The result of Granger Causality show that government revenue, economic growth and BI rate has a causality impact to budget deficit. Controlling those three variables will directly impact the budget deficit.

The Effect of Capital Expenditure, Agricultural Sector Contribution, and Education on the Poverty Rate

Restiatun Restiatun — 2024-12-19

This study examines the impact of capital expenditures, education, and the contribution of the agriculture sector on poverty level. The research employs a quantitative approach using panel data regression model, specifically the Fixed Effect Model (FEM) regression. The findings indicate that the agriculture sector contribution has a significant negative impact on poverty level. This result is consistent with the economic structure in most districts of Indonesia, notably in The West Kalimantan Province, where the agricultural sector is a key economic driver and the largest employer. This should be a consideration for the government to make the agricultural sector as a strategic sector in alleviating poverty. Conversely, capital expenditure does not significantly affect the poverty rate, likely due to the reliance on capital-intensive technologies in government projects. Similarly, the education variable has no significant effect, as the mean years of schooling in West Kalimantan Province indicate that most of the population has only attained a junior high school level of education. This underscores the need for the government to reform the education and training systems to foster improved human capital development. Strengthening the agricultural sector and increasing educational outcomes are critical strategies for reducing poverty in the region.

Determinan Kemandirian Keuangan Pemerintah Kabupaten/Kota di Indonesia

Riza Aditya Syafri — 2024-12-20

The fiscal decentralization policy has been implemented in Indonesia for more than two decades. However, its implementation has not successfully reduced local governments' reliance on transfers from the central government, which has contributed to the low level of financial independence among local governments. This study aims to identify and analyze the determinants of fiscal independence in the regions by using a quantitative approach through panel data regression and using inter-regional comparisons covering western, central, and eastern regions in Indonesia during 2016-2021. The panel data regression analysis shows that the effectiveness of Local Revenue (PAD), Human Development Index (HDI), and investment have a positive effect across all regions. Meanwhile, economic growth and population have a significant effect only in the western and eastern regions of Indonesia. Additionally, central government transfer funds significantly affect the western and central regions of Indonesia. Furthermore, capital expenditure and personnel expenditure have significant effects only in the western region of Indonesia. These findings indicate that there are different characteristics that affect financial independence in each region, so that different policy directions are needed to encourage financial independence in each region.

Analisis Keuangan Pemerintah dengan Model Fiscal Trend Monitoring System: Studi Kasus Kabupaten Bandung

R. Muhammad Rouffie Putera Kesuma Runjung — 2024-12-19

Any local government in Indonesia has different financial capabilities and conditions according to their respective indicators and factors. These financial conditions also have an impact on how the regional government's ability to deal with obstacles such as the corona virus disease-2019 (COVID-19) pandemic which has a significant impact on the implementation of regional financial management. Several methods that have been used in measuring the financial condition of the government still have limitations on the time period specified in the research and research outputs that are limited to quantitative data only. Therefore a government financial analysis model is needed that can cover the existing limitations with the implementation of the fiscal trend monitoring system (FTMS) model. This study aims to analyze and determine the financial condition of local governments by taking a locus in the Bandung Regency government. This research approach is qualitative, utilizing the FTMS model, which consists of five dimensions and twelve indicators of local government financial reports. The research results obtained are that the financial condition of Bandung Regency is still low. In terms of dimensions, only the revenue dimension has a positive trend while the rest, namely the expenditure dimension, the operating position of the local government, the debt structure, and the condition of fixed assets still have indicators with a negative trend. In detail, of the twelve indicators of the FTMS model of Bandung Regency government financial performance, seven indicators show a positive trend while the other five indicators still lead to a negative trend.

Determinan Ekspor Industri Kecil dan Menengah Penerima Fasilitas Kemudahan Impor Tujuan Ekspor (KITE)

Ronald Guntara — 2024-12-19

The fluctuations in export value over the past few years caused Indonesia’s trade balance to be in deficit in 2018 and 2019. Through duty drawback policy to small and medium industry (KITE IKM), the government provides facilities to boost exports. This study aims to determine the effect of KITE IKM, rupiah exchange rate, Gross Domestic Product (GDP), inflation, and COVID-19 on the export value of KITE IKM. The method used is quantitative method, with secondary data from Directorate General of Customs and Excise (DJBC) and Central Bureau of Statistics (BPS) from March 2017 to December 2020. The data is processed with multiple linear regression analysis using a time series dataset of 46 months. The results showed that KITE IKM, rupiah exchange rate, and GDP had a significant positive effect, while inflation had no significant effect and COVID-19 had a significant negative effect on the export value of KITE IKM. The study concludes that the KITE IKM facility should be maintained and further developed because it enhances exports. The government is expected to stabilize the rupiah exchange rate, GDP, and inflation at levels that promote exports. Relaxation is needed, such as extending the export period in using KITE IKM facilities during the pandemic.

Dampak Ekonomi Insentif PPN DTP Perumahan dan PPNBM DTP Kendaraan Bermotor pada Masa Pandemi

Wiradinata Lambok Silaban — 2024-12-20

The economic downturn caused by the pandemic, prompted the Indonesian government to produce fiscal policy in government-borne tax incentive scheme to stimulate economic growth. This study aimed to find out whether the real estate sector and the processing industry sector do have a big impact on the economy and to determine the quantitative economic impact as an implication of government-borne value-added tax for houses and government-borne sales tax on luxury goods for motor vehicle of IDR5.202 trillion in 2021 in terms of output, labor, and VAT potential and provide suggestions related to tax incentives. This study used input-output analysis with Indonesian IO Table tool of 2016 which was updated to IO Table of 2021 using RAS method. The data used are secondary data published by Central Bureau of Statistics and Fiscal Policy Agency. The results of the analysis showed that the real estate sector does not have a big influence on the economy, but the processing industry sector gives a big influence. The study also found that the impact of tax incentives was able to create increases in total output of IDR8.884 trillion, employment of 37,174 people, and potential VAT of IDR0.463 trillion. The results of this study suggest the government to consider the priority of providing incentives more directed and measurable by adjusting the objectives of the incentives and targeted sectors, paying attention to strategic and alternative sectors, and continuing the government-borne tax incentive scheme in the event of an economic slowdown.