The Role of Tax Incentives in Supporting a Green Economy in Micro, Small, And Medium Enterprises in Kendari City

Abstract

The effects of decreasing natural carrying capacity and increasingly losing biodiversity systems encourage us to think about policy concepts that are not only oriented toward output growth but also about the sustainability of increasingly limited natural resources. One relevant concept is providing incentives to MSMEs as a driver for implementing a green economy by utilizing resources sustainably and minimizing pollution and other environmental impacts. As one of the most significant contributors to GDP, MSMEs must transform by introducing green management processes in business activities. The existence of tax incentives is intended to encourage MSMEs to support the green economy with indicators of green attitude, green strategy, green governance, green monitoring, and green modeling. Based on this, this research aims to describe the perceptions of MSME business actors towards tax incentives and analyze the relationship between tax incentives and green economy indicator variables. This research uses a sign test to see whether there are fundamental differences without paying attention to these differences and Spearman rho to test the relationship between variables. Based on the results of the sign test show that only the green strategy has no effect, even though there are tax incentives with a value of 0.05 < 0.8282. In other words, if there is no difference between before and after the existence of tax incentives, the probability of getting at most 6 out of 10 respondents who report no role of tax incentives is 82 percent. Meanwhile, other indicators show the role of incentives in supporting the implementation of a green economy. Meanwhile, the Spearman Rho results show that the green strategy and green modeling indicators have no or weak relationship with tax incentives.