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Improving Land Productivity through Fiscal Policy: A Framework for Analysis
The report analyzes Indonesia's land-use revenue systems, finding that 93.5% of revenue is based on production rather than land size, which fails to disincentivize land expansion. It identifies high-potential areas for reform, including the Land and Building Tax, Forestry Non-Tax Revenue, and the use of Adjustment Funds for earmarking sustainable land use activities. The analysis also highlights how current central-to-regional revenue sharing may perversely encourage local governments to grant more land permits to increase their budgets.
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Document type: Report
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