Implications of Law Number 1 of 2022 Concerning Central and Regional Financial Relations on the Implementation of Fiscal Decentralization

Abstract

Granting regional autonomy is an effort to empower regions in order to manage development in their regions; creativity, innovation, and independence are expected to be possessed by each region so as to reduce the level of dependence on the Central Government. What is more important is that with regional autonomy, the quality of services provided by the government to the community will increase, both services that are directly provided to the community and services that are not provided directly, such as the creation of public facilities and other social facilities. In other words, the provision of public goods and public services can be more guaranteed. This research uses normative juridical research methods in writing, as well as describing it descriptively and qualitatively with a problem formulation of the implications of Law Number 1 of 2022 concerning Central and Regional Financial Relations on the Implementation of Fiscal Decentralization. The new regulation of central and regional financial relations through Law Number 1 of 2022 is a new direction for implementing fiscal Decentralization in Indonesia. There is an improvement in the quality of environmental maintenance in areas producing natural resources which can be further increased because there is a portion of DBH that will be allocated based on environmental maintenance performance. Apart from that, regional taxation regulations are also a commitment from the central government to support regional independence while maintaining access to public services and the climate of the regional economy. By strengthening improvements in regional spending, of course, the quality of the APBD will be strengthened so that it is more efficient, effective, focused, accountable, and synergistic. Finally, by regulating national fiscal synergies, the community will enjoy more focused and sustainable regional development.