Modernizing Local Government Taxation in Indonesia

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This report presents the challenges and achievements of the Tax Revenue Administration Modernization and Policy Improvement in Local Governments (TRAMPIL) project in Indonesia to help subnational governments boost local-source tax revenues.

TRAMPIL, supported by the Asian Development Bank, offers policy recommendations in the context of Indonesia’s economic and legal parameters on regional autonomy. The provincial, city, and regency governments in the country typically rely on the central government for financial support. A shift toward the collection of their own tax revenues would strengthen local governments’ autonomy and encourage accountability to their communities.