Jakarta (ANTARA) – The Indonesian District Governments Association (Apkasi) called for updates to regional fiscal regulations to strengthen the capacity of regional governments to attract investment and accelerate development.
Apkasi Chairman Bursah Zanubi stressed the urgency of adjusting fiscal provisions to reflect economic changes, administrative costs, and the growing complexity of regional development, according to a statement cited on Sunday.
He referred to central government regulations issued in 2000 and 2010, which govern the fiscal position of regional leaders and the procedures for granting and utilizing regional tax and retribution incentives, respectively.
“Updating these regulations will provide district governments with greater flexibility to optimize development financing, strengthen investment, and improve the quality of public services,” Zanubi remarked.
He argued that more adaptive regulations are particularly needed by districts constrained by low locally generated revenue, such as those in East Nusa Tenggara and other eastern regions.
The Apkasi chairman noted that such areas rely heavily on central government transfers, as their locally generated revenue is only around Rp5 billion (US$277,000) annually
“We propose deregulating regional asset utilization, simplifying regulations on public-private partnerships, and synchronizing corporate social responsibility funds with regional development plans to maximize public benefits,” he said.
Moreover, Apkasi urged the government to grant regional administrations the authority to manage infrastructure compensation funds derived from the extraction of non-metallic minerals and rocks to support road and bridge maintenance.
Apkasi Executive Chair Dadang Supriatna advocated a greater role for local administrations in harnessing regional potential, including new and renewable energy resources, to strengthen fiscal capacity.
He stressed that regional governments must be enabled to diversify their revenue sources to reduce dependence on central government transfers, advance development, and sustain public services.
Apkasi conveyed these aspirations during a hearing with Home Affairs Minister Tito Karnavian and Commission II of the House of Representatives (DPR) in Jakarta on Thursday (July 30).
Speaking after the meeting, Karnavian said the government would prepare a new regulation to improve the governance of regional leaders’ financial rights.
He announced plans to establish a team to advance the initiative in collaboration with the Finance Ministry and the Ministry of National Development Planning.
Even so, the minister urged regional leaders to work creatively and innovatively to increase locally generated revenue in order to improve public services.
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Translator: A.M. Fauzan, Tegar Nurfitra
Editor: Primayanti
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