Academics Say Bali’s New Tourism Tax Can Create Big Benefits For Travelers

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In 2024 Bali will introduce a mandatory tourism tax for all international arrivals on the island.

The announcement of the new tourism tax has got Bali lovers from all walks of life offering their two cents on how the funds can be best spent to support local communities and improve the tourist experience.

Bali’s Governor Wayan Koster has confirmed that the tax will be spent in a transparent manner but has yet to confirm exactly where revenue will be distributed. He confirmed that the proposed legislative changes have been submitted and that if everything goes to plan, the tax will be formally introduced in mid-2024. 

The tax is set to be introduced at IDR 150,000 per person, including for children. The fee will be payable via an electronic payment system at Bali Airport and at the seaports. Governor Koster confirmed that the payment would only be payable in Indonesian Rupiah in order to avoid any current functions. 

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While the IDR 150,000 fee is around USD 10, the announcement has triggered a dialogue about whether the fee is too high or too low.

Many politicians, academics, and Bali tourism stakeholders feel that in order to establish higher quality and sustainable tourism on the island that the fee must be higher so that the destination is only accessible to people with great travel budgets.

Speaking to reporters, Prof. Ir. Gede Sri Darma explained his vision for how the tourism tax could be best utilized to ensure that Bali remainder a world-class tourism destination.

Prof. Drama, who is a strategic management and information systems specialist in economics and tourism at the Undiknas University in Denpasar, feels the introduction of the tourism tax has great potential for Bali. 

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Prof. Darma explained that now legislation changes are underway, and the hard work is to get everyone on board with the new tax policy.

He said, “The only problem now is whether they will accept it. Because they go everywhere, there have never been strange fees, for example, France or other countries.”

Much like many Bali lovers who have spoken out about the new tourism tax, Prof. Darma agrees that transparency is key.

He noted how Bali is the county’s biggest contributor to foreign exchange after the oil and gas industry, and as such, the revenue must not be ‘leaked into unauthorized hands’. 

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This is an issue that has already been addressed by Governor Koster.

Shortly after the initial announcement, he confirmed that the electronic payment system for the tourism tax would ensure that funds are collected and distributed in a traceable way. 

Prof Darma hopes that the funds can be used to help protect Balinese culture and natural landscapes.

The prospective funds collected by the tourism tax have yet to be assigned a budget, but Governor Koster is clear that the revenue must help fund nature conservation and cultural preservation. 

Local community leaders are hopeful that at least some of the funds generated by the tourism tax can be assigned to tackling the inland’s mounting waste management issue and traffic congestion.

Both are issues that impact local communities and tourists in such a way that if they are not resolved soon risk creating a negative public image of Bali, damaging lives and livelihoods too. 

He is not concerned about the impact the new fee will have on tourist numbers.

While some tourists have started to explore other vacation destinations in light of the paid-for visa on arrival from Indonesia being introduced after the pandemic and now the new tourism tax, data shows that Bali is in higher demand by tourists than travel experts predicted.

The island is not only on track to hit tourism targets by the end of the year but surpass them.

Over 2 million international arrivals have visited Bali so far this year, and with the target of 4.5 million tourists on the horizon, leaders and travel experts are confident the island will remain the destination of choice for travelers heading to South East Asia on vacation.