The Effect of Economic Growth and Foreign Exchange Rates on the Realization of Tax Receipts

Authors

  • Hafidh Novanto, Ridwan Triyanto, Fikri Zaky Sauqi, Muhammad Daffa Hazman A., Diana Sari

Abstract

This research aims to test and analyze the effect of economic growth and foreign exchange rates on the realization of tax receipts. The realization of tax receipts in Indonesia for the period 2007-2019 fluctuated. Over the past 12 years, the realization of tax receipts has only met the target once in 2008. One factor that can affect tax receipts is economic growth. Through economic growth, a country's ability to produce goods and services will increase. This will have an impact on state tax receipts. Another factor that can affect tax receipts is the value of the currency. The value of money is determined by its purchasing power which may change over time. The rupiah exchange rate that continued to decline over the last 4 years of the period 2015-2019 had an impact on the decrease in state tax receipts. Research methods are descriptive and verificative, research data is secondary data, research samples are data from each variable for the last 10 years from 2009 to 2019. The results showed that after conducting several statistical tests obtained from this study showed that the two independent variables had simultaneous and partial impact on dependent variables, while the results to find out the short term relationship equilibrium that was done with the error correction method (ECM) showed that each variable is free (partially) i.e. economic growth and foreign exchange rates show signifying against dependent variables (Tax). This indicates that these free variables have a short run equilibrium relationship against dependent variables which is evidenced by the Probability value (Prob.) each variable is smaller than ?=5%. Thus simultaneously variable free has an influence on the realization of tax receipts, this is evidenced by the prob value (F-Statistic) of 0.0511 this value is greater than ?=5% which means accept H0.

Published

2020-11-01

Issue

Section

Articles