Abstract

The main objective of this research is to see the causal relationship between infrastructure, taxes and GRDP per capita. The method used in this research is a quantitative approach with the variables are infrastructure, taxes and per capita GRDP. The infrastructure used here is the length of the road in kilometers; tax in rupiah units; while the GRDP used is per capita GRDP in rupiah units. All data used are secondary data in the form of time series data for the period 2006-2019. The results showed that first, infrastructure, taxes and per capita GRDP had no causality, but there was a one-way relationship, namely taxes affecting infrastructure; second, the cointegration test through the Johansen Co-Integration test shows that there is no cointegration; third, the function of impulse response and forecast error decomposition shows that the variable that most influences infrastructure and taxes is GRDP per capita, while the variable that most influences infrastructure is GRDP per capita; Fourth, the relationship variable based on the results of the Granger-Causality analysis test which is supported by the analysis of the impulse response function and the variance decomposition can conclude that the fluctuating tax growth has a direct effect (through per capita GRDP) on infrastructure improvement.

Keywords: infrastructure, taxes and per capita GRDP