The purpose of this research is to determine the effect of general allocation funds, local revenue, capital expenditures and the income per capita to the level of local independent financial and tax effort at the district / city in the Timor island, Province of East Nusa Tenggara period 2008-2013 by the tax effort itself. Purposive sampling is chosen as the sampling method of this study.
The examination of hyphotheses in this research consist of the data modeling, classical assumption test, and regression equation. This reasearch used secondary data and Eviews 7 program. The used Secondary data were obtaining from the site of the statistics of central bureau and The ministry of Republic Indonesia’s finance, and General Directorate of Fiscal Balance.
The result shows that the general allocation funds have a significantly negative effect on the level of local financial independence, and the local revenues have a significantly positive effect on the local financial independence, while the capital spending and per capita of income has no effect on the level of local financial independence.
The next results shows that general allocation fund has no influence on the tax effort, but local revenue variables have a significant positive effect on the tax effort. For the variable of the capital expenditure and the income variable per capita have no effect on the tax effort.
Keywords: general allocation funds, local revenue, capital expenditures, per income percapita, the level of the local independent financial, tax effort.