The Impact of Law Number 1 of 2022 on Regional Tax Revenue for Increasing Regional Income

Abstract

Abstract—This research aims to analyze the regional tax potential of Malang City, considering the latest regulations on regional income, specifically Law No. 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments. This study employed a quantitative descriptive analysis with a correlative approach. Secondary data from various institutions were utilized for analysis, employing a rate and trend approach to assess the regional tax potential. The research findings indicate a positive economic trend in Malang City until 2019, with an increase observed in 2021. Law No. 1 of 2022 introduces updates to the types of taxes, rates, and procedures for collecting Regional Taxes and Regional Retributions in regions. Based on the realization of regional tax revenue and the results of the trend analysis, it was projected that restaurant tax revenue, swallow's nest tax revenue, and non-metallic minerals and rocks tax revenue, under pessimistic, moderate, and optimistic schemes, would surpass the 2022 figures in 2023. Additionally, by consolidating all the regional tax revenue projections in Malang City, the potential for tax revenues under the optimistic scheme was expected to achieve the projected Local Own-source Revenue and Regional Tax Revenue for Malang City