PIPI

Bilancia : Jurnal Ilmiah AkuntansiBilancia : Jurnal Ilmiah Akuntansi

Regional independence reflects the level of community participation in regional development; the more independent an area is, the higher the community participation in paying local taxes and fees, which are the main components of Local Own-Source Revenue (LOSR). This study aims to evaluate and describe the level of inequality of regional financial independence using the Williamson Index between Cities in West Sumatra for the period 2014-2017. The method used is the analysis of the ratio of regional financial independence by looking at the comparison of the realization of LOSR to central government transfers, provincial transfers, and regional loans in 2014-2017, then the results were analyzed using the Williamson Index to see the disparity of regional financial independence between Cities in West Sumatra. The results showed that the ratio of regional financial independence between cities in West Sumatra is categorized as Low with an average of 27.79%. Based on the Williamson Index, inter-city financial independence in West Sumatra has not been evenly distributed, falling into the Inequitable category.

The ratio of regional financial independence among cities in West Sumatra remains low, and the level of inequality in regional financial independence between cities is categorized as unequal.Despite improvements in the regional original revenue of Padang City, it still relies heavily on transfer funds from the central and provincial governments.The disparity in financial independence is influenced by the different potential of each region, impacting their ability to generate local revenue.

Further research could investigate the specific factors hindering the improvement of PAD in cities with low financial independence, such as Pariaman, focusing on strategies to optimize local revenue sources. Additionally, a comparative study analyzing the effectiveness of different regional financial management policies across cities in West Sumatra could provide valuable insights for policy recommendations. Finally, exploring the relationship between regional economic diversification and financial independence, particularly focusing on the development of tourism and other potential sectors, could offer a pathway towards greater financial autonomy for local governments. These studies should consider the unique characteristics of each city and aim to provide practical solutions for enhancing regional financial resilience and reducing dependence on central government transfers, ultimately contributing to more equitable regional development across West Sumatra. The research should also explore the impact of human resource capacity building in local governments on their ability to effectively manage finances and increase PAD.

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