A Predicting the Future: A Forecast of Bukittinggi's Original Local Revenue from 1996 to 2024

Abstrak

This study aims to accurately forecast Bukittinggi City’s Original Local Revenue (PAD) for the period from 2025 to 2029 by applying the ARIMA (Autoregressive Integrated Moving Average) modeling approach. Secondary data were obtained from the Bukittinggi City BPS website, covering annual revenue figures from 1996 to 2024. The analysis begins with a thorough exploratory examination to identify trends and key fluctuations in PAD, including the marked decline during the COVID-19 pandemic in 2020, which significantly impacted revenue patterns. To ensure reliable forecasts, the time series data undergo Box-Cox transformations and differencing to achieve stationarity required for ARIMA modeling. Various diagnostic tests, such as the Ljung-Box test for residual autocorrelation and the Kolmogorov-Smirnov test for normality of residuals, guide the appropriate selection of the most suitable model. The ARIMA (1,1,0) model emerges as the best fit, yielding robust and reliable forecasting results. The projections estimate an average annual PAD value of approximately 138.167billion Rupiah throughout the 2025 to 2029 timeframe. However, forecast uncertainty increases over time, indicated by wider confidence intervals in the later years. These important findings highlight the critical importance of thorough fiscal planning and diversification of revenue sources for Bukittinggi City to withstand potential economic shocks and uncertainties caused by both internal and external factors. The research strongly underscores the necessity for adaptive and resilient financial strategies to sustain steady local revenue growth amid varying and challenging economic conditions. This comprehensive study provides valuable insights to support informed policy-making and effective revenue management by local government authorities.