The Effect of Local Revenue Expected on Regional Expenditure in Sumatra Provincial City Districts

Abstract

This study aims to analyze the influence of Regional Original Revenue on Regional Expenditure in districts/cities in North Sumatra Province. Regional Original Revenue is one of the sources of regional revenue that reflects the ability of local governments to explore local economic potential, while Regional Expenditure. This study uses a quantitative approach with secondary data in the form of financial statements or regency/city APBD data in North Sumatra Province. The independent variable in this study is Regional Original Revenue, while the dependent variable is Regional Expenditure. The data analysis technique used is regression analysis to find out the extent to which Regional Original Revenue has an effect on Regional Expenditure. It is expected to show that Regional Original Revenue has an important role in supporting the spending ability of local governments. The greater the Regional Original Revenue obtained, the greater the opportunity for local governments to finance spending needs for development and community services. However, if the contribution of Regional Original Revenue is still low, then Regional Expenditure tends to still depend on transfer funds and other sources of income.