ABSTRACT
Tax is the most important source of revenue for a state. One of the local taxes that can be collected by the local government is the groundwater tax regulated in the Law No. 28 of 2009 on local taxes. Groundwater tax is the most crucial tax as the exploitation of groundwater causes damage to the environment. This paper will discuss whether the tax collected compensates the damage caused by the exploitation of groundwater. What is the purpose of groundwater tax collection? Do the results of the groundwater tax realize a prosperous society? This paper uses a normative legal review to examine whether the meaning contained in the rules of law is conceptually well aware of the application in practice. This paper used the statute approach and the analytical approach. Data processing was done by the qualitative approach and the quantitative approach. This research was conducted in Jakarta, Bogor, and Sukabumi. Collection of the groundwater tax creates a paradox in its implementation. On the one hand, the local government requires funds to finance regional governance, and the funds derive from local taxes. On the other hand, the exploitation of groundwater damages the environment. The collection of taxes should be for the purpose of financing public interest and enhancing the prosperity of the entire community.
