IDEAS home Printed from https://ideas.repec.org/a/eee/forpol/v61y2015icp39-50.html
   My bibliography  Save this article

Redesigning Indonesian forest fiscal policy to support forest conservation

Author

Listed:
  • Nurfatriani, Fitri
  • Darusman, Dudung
  • Nurrochmat, Dodik Ridho
  • Yustika, Ahmad Erani
  • Muttaqin, Muhammad Zahrul

Abstract

The formulation of fiscal policy in the forestry sector was designed as a green incentive for local governments to conserve forest area in Indonesia. However, evidence demonstrates an increasing rate of deforestation occurred during the implementation of fiscal policy reforms. Thus, problems persist in the implementation of fiscal policies in the forestry sector. This study evaluates the gap between the rule and the implementation of forest fiscal policy, focusing on regulatory, economic, administrative, and informational instruments. There are four main findings of this study. First, there are several inappropriate and even conflicting regulations concerning local government authorities and forest conservation; second, the lack of coordination among agencies is one of the most important factors causing sub-optimal collection of “non-tax state revenues” from the forestry sector; third, forest fiscal policies in Indonesia mostly focus on collecting financial benefits from timber rather than preserving ecosystem functions, and; fourth, there is a weak management information system concerning forest fiscal policy. To address the gaps identified in this study, the implementation of green fiscal policy in the forestry sector must provide a comprehensive regulatory framework and improve the capacity of human resources.

Suggested Citation

  • Nurfatriani, Fitri & Darusman, Dudung & Nurrochmat, Dodik Ridho & Yustika, Ahmad Erani & Muttaqin, Muhammad Zahrul, 2015. "Redesigning Indonesian forest fiscal policy to support forest conservation," Forest Policy and Economics, Elsevier, vol. 61(C), pages 39-50.
    • Handle: RePEc:eee:forpol:v:61:y:2015:i:c:p:39-50
    DOI: 10.1016/j.forpol.2015.07.006
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1389934115300265
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.forpol.2015.07.006?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kumar, Surender & Managi, Shunsuke, 2009. "Compensation for environmental services and intergovernmental fiscal transfers: The case of India," Ecological Economics, Elsevier, vol. 68(12), pages 3052-3059, October.
    2. Jean-Michel Salles, 2011. "Valuing biodiversity and ecosystem services: why linking economic values with Nature?," Working Papers 11-24, LAMETA, Universtiy of Montpellier, revised Dec 2011.
    3. Scholtens, Bert, 2001. "Borrowing green: economic and environmental effects of green fiscal policy in The Netherlands," Ecological Economics, Elsevier, vol. 39(3), pages 425-435, December.
    4. Alberto Majocchi, 1996. "Green fiscal reform and employment: A survey," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 8(4), pages 375-397, December.
    5. Laroui, Fouad & van Leeuwen, Marko J., 1996. "Fiscal policy and greenhouse gases: the case of the Netherlands," Ecological Economics, Elsevier, vol. 18(3), pages 231-241, September.
    6. Kunce, Mitch & Shogren, Jason F., 2008. "Efficient decentralized fiscal and environmental policy: A dual purpose Henry George tax," Ecological Economics, Elsevier, vol. 65(3), pages 569-573, April.
    7. Ring, Irene, 2002. "Ecological public functions and fiscal equalisation at the local level in Germany," Ecological Economics, Elsevier, vol. 42(3), pages 415-427, September.
    8. Vollebergh, Herman R.J., 2008. "Lessons from the polder: Energy tax design in The Netherlands from a climate change perspective," Ecological Economics, Elsevier, vol. 64(3), pages 660-672, January.
    9. Wang, Nannan & Chang, Yen-Chiang, 2014. "The development of policy instruments in supporting low-carbon governance in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 35(C), pages 126-135.
    10. Bossier, Francis & Brechet, Thierry, 1995. "A fiscal reform for increasing employment and mitigating CO2 emissions in Europe," Energy Policy, Elsevier, vol. 23(9), pages 789-798, September.
    11. Bob Giddings & Bill Hopwood & Geoff O'Brien, 2002. "Environment, economy and society: fitting them together into sustainable development," Sustainable Development, John Wiley & Sons, Ltd., vol. 10(4), pages 187-196.
    12. Irawan, Silvia & Tacconi, Luca & Ring, Irene, 2013. "Stakeholders' incentives for land-use change and REDD+: The case of Indonesia," Ecological Economics, Elsevier, vol. 87(C), pages 75-83.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Irawan, Silvia & Widiastomo, Triyoga & Tacconi, Luca & Watts, John D. & Steni, Bernadinus, 2019. "Exploring the design of jurisdictional REDD+: The case of Central Kalimantan, Indonesia," Forest Policy and Economics, Elsevier, vol. 108(C), pages 1-1.
    2. Hunggul Yudono Setio Hadi Nugroho & Yonky Indrajaya & Satria Astana & Murniati & Sri Suharti & Tyas Mutiara Basuki & Tri Wira Yuwati & Pamungkas Buana Putra & Budi Hadi Narendra & Luthfy Abdulah & Tit, 2023. "A Chronicle of Indonesia’s Forest Management: A Long Step towards Environmental Sustainability and Community Welfare," Land, MDPI, vol. 12(6), pages 1-62, June.
    3. Erbaugh, James T. & Nurrochmat, Dodik R., 2019. "Paradigm shift and business as usual through policy layering: Forest-related policy change in Indonesia (1999-2016)," Land Use Policy, Elsevier, vol. 86(C), pages 136-146.
    4. Ekawati, Sulistya & Subarudi, & Budiningsih, Kushartati & Sari, Galih Kartika & Muttaqin, Muhammad Zahrul, 2019. "Policies affecting the implementation of REDD+ in Indonesia (cases in Papua, Riau and Central Kalimantan)," Forest Policy and Economics, Elsevier, vol. 108(C), pages 1-1.
    5. Fitri Nurfatriani & Ramawati & Galih Kartika Sari & Heru Komarudin, 2019. "Optimization of Crude Palm Oil Fund to Support Smallholder Oil Palm Replanting in Reducing Deforestation in Indonesia," Sustainability, MDPI, vol. 11(18), pages 1-16, September.
    6. Uddin, Mohammad Nizam & Hossain, Mohammad Mosharraf & Chen, Yong & Siriwong, Wapakorn & Boonyanuphap, Jaruntorn, 2019. "Stakeholders' perception on indigenous community-based management of village common forests in Chittagong hill tracts, Bangladesh," Forest Policy and Economics, Elsevier, vol. 100(C), pages 102-112.
    7. Cadman, Tim & Sarker, Tapan & Muttaqin, Zahrul & Nurfatriani, Fitri & Salminah, Mimi & Maraseni, Tek, 2019. "The role of fiscal instruments in encouraging the private sector and smallholders to reduce emissions from deforestation and forest degradation: Evidence from Indonesia," Forest Policy and Economics, Elsevier, vol. 108(C), pages 1-1.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Tacconi, Luca & Muttaqin, Muhammad Zahrul, 2019. "Reducing emissions from land use change in Indonesia: An overview," Forest Policy and Economics, Elsevier, vol. 108(C), pages 1-1.
    2. Xin Yang & Fan Zhang & Cheng Luo & Anlu Zhang, 2019. "Farmland Ecological Compensation Zoning and Horizontal Fiscal Payment Mechanism in Wuhan Agglomeration, China, From the Perspective of Ecological Footprint," Sustainability, MDPI, vol. 11(8), pages 1-15, April.
    3. : Eduardo L. Giménez (a) & Miguel Rodríguez, "undated". "Pigou’S Dividend Versus Ramsey’S Dividend In The Double Dividend Literature," Working Papers 2-06 Classification-JEL :, Instituto de Estudios Fiscales.
    4. Mumbunan, Sonny & Ring, Irene & Lenk, Thomas, 2012. "Ecological fiscal transfers at the provincial level in Indonesia," UFZ Discussion Papers 06/2012, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
    5. Bosquet, Benoit, 2000. "Environmental tax reform: does it work? A survey of the empirical evidence," Ecological Economics, Elsevier, vol. 34(1), pages 19-32, July.
    6. Droste, N. & Ring, I. & Santos, R. & Kettunen, M., 2018. "Ecological Fiscal Transfers in Europe – Evidence-Based Design Options for a Transnational Scheme," Ecological Economics, Elsevier, vol. 147(C), pages 373-382.
    7. Jonah Busch & Irene Ring & Monique Akullo & Oyut Amarjargal & Maud Borie & Rodrigo S. Cassola & Annabelle Cruz-Trinidad & Nils Droste & Joko Tri Haryanto & Ulan Kasymov & Nataliia Viktorivna Kotenko &, 2021. "A global review of ecological fiscal transfers," Nature Sustainability, Nature, vol. 4(9), pages 756-765, September.
    8. Nils Droste & Claudia Becker & Irene Ring & Rui Santos, 2018. "Decentralization Effects in Ecological Fiscal Transfers: A Bayesian Structural Time Series Analysis for Portugal," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 71(4), pages 1027-1051, December.
    9. Sauquet, Alexandre & Marchand, Sébastien & Féres, José Gustavo, 2014. "Protected areas, local governments, and strategic interactions: The case of the ICMS-Ecológico in the Brazilian state of Paraná," Ecological Economics, Elsevier, vol. 107(C), pages 249-258.
    10. Thollander, Patrik & Kimura, Osamu & Wakabayashi, Masayo & Rohdin, Patrik, 2015. "A review of industrial energy and climate policies in Japan and Sweden with emphasis towards SMEs," Renewable and Sustainable Energy Reviews, Elsevier, vol. 50(C), pages 504-512.
    11. Alberto Gago & Xavier Labandeira & Xiral López Otero, 2014. "A Panorama on Energy Taxes and Green Tax Reforms," Hacienda Pública Española / Review of Public Economics, IEF, vol. 208(1), pages 145-190, March.
    12. Sridhar, Kala S. & Kumar, Surender, 2012. "India’s urban environment: air and water pollution and pollution abatement," MPRA Paper 43810, University Library of Munich, Germany.
    13. Garfield Wayne Hunter & Gideon Sagoe & Daniele Vettorato & Ding Jiayu, 2019. "Sustainability of Low Carbon City Initiatives in China: A Comprehensive Literature Review," Sustainability, MDPI, vol. 11(16), pages 1-37, August.
    14. Endl, Andreas & Tost, Michael & Hitch, Michael & Moser, Peter & Feiel, Susanne, 2021. "Europe's mining innovation trends and their contribution to the sustainable development goals: Blind spots and strong points," Resources Policy, Elsevier, vol. 74(C).
    15. Xing Zhao & Yifan Guo & Zhen Liu & Anteng Xiu, 2023. "Boosting green recovery: the impact of green fiscal policy on green total factor productivity," Economic Change and Restructuring, Springer, vol. 56(4), pages 2601-2619, August.
    16. Ana Paula Coelho Clauberg & Renato de Mello & Flávio José Simioni & Simone Sehnem, 2021. "System for assessing the sustainability conditions of small hydro plants by fuzzy logic," Sustainable Development, John Wiley & Sons, Ltd., vol. 29(2), pages 300-317, March.
    17. Fitri Nurfatriani & Ramawati & Galih Kartika Sari & Heru Komarudin, 2019. "Optimization of Crude Palm Oil Fund to Support Smallholder Oil Palm Replanting in Reducing Deforestation in Indonesia," Sustainability, MDPI, vol. 11(18), pages 1-16, September.
    18. Nelson Jorge Ribeiro Duarte & Francisco José Lopes de Sousa Diniz, 2011. "The Role Of Firms And Entrepreneurship On Local Development," Romanian Journal of Regional Science, Romanian Regional Science Association, vol. 5(1), pages 54-69, JUNE.
    19. Pick-Soon Ling & Ming K. Lim & Ming-Lang Tseng, 2020. "Assessing Sustainable Foreign Direct Investment Performance in Malaysia: A Comparison on Policy Makers and Investor Perceptions," Sustainability, MDPI, vol. 12(20), pages 1-38, October.
    20. Ruijs, Arjan & Vollebergh, Herman, 2013. "Lessons from 15 Years of Experience with the Dutch Tax Allowance for Energy Investments for Firms," Energy: Resources and Markets 151533, Fondazione Eni Enrico Mattei (FEEM).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:forpol:v:61:y:2015:i:c:p:39-50. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/forpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.