Bali is a multi-faceted travel destination. Whether tourists want to party, deep dive into culture, retreat into a community retreat, or rest, the island offers it all.
For tourists looking for VIP treatment and spending time at one of the island’s top spas and retreat spaces, the cost of experiences is about to get more expensive.
As taxes go up across the board in Indonesia, the island’s spas will have no option but to reflect the increasing cost of taxes in their prices to tourists.
Spa taxes in Indonesia are about to be raised to a whopping 40%.
This news has left industry leaders reeling and raising questions as to why the sudden hike and whether the government is going to create a balance elsewhere in the legislation.
In Indonesian law, spas are now being taxed the same as entertainment venues, something that industry leaders are also not happy about.
The Chairman of the Indonesian Hotel General Manager Association for Bali, Yoga Iswara, shared his surprise at the change in taxation for spas.
He and his teams do not see spas as entertainment venues but rather an extension of Balinese culture and the wellness industry.
He noted, “In Bali Matirta and Melukat (water blessing ceremonies) are rituals that are closely related to traditional and cultural activities, the spa is also a combination of traditional and modern activities which is why Bali is so famous for its wellness spas.”
He added that “the international appreciation for wellness itself is so high that Bali has become one of the world’s best wellness destinations, not entertainment.”
With this in mind, he says that the new 40% entertainment venue taxes are not appropriate.
Iswara said, “In addition to regulation number 10 of 2009 concerning tourism it is clear that spas are included in one of the tourism businesses that are not categorized as entertainment venues.”
@cecewiththefro Kaveri Spa was such an amazing experience for my friend and I on our Bali trip! It was so relaxing and was definitely a princess treatment for me🌸🌼🌺 I give it a 10/10, it’s perfect as a personal spa experience or with a partner💖✨ #bali #balitrip #balitravel #udayaspa #kaverispa #flowerbath #blackgirlluxury ♬ soso – Omah Lay
He continued “Likewise from a health perspective there is Minster of Health Regulation8 of 2014 concerning gildings for spa service that states that a spa is an Indonesian health resource. So it is clear there that spas are wellness [spaces, not entertainment].”
Iswara confirmed that the IHGMA will be raising their concerns to the government in a bid to get the new 40% spa tax overturned in Bali.
He told reporters “Spas have been in the wellness category by combining traditional and modern practices to balance body, soul, and mind. That is the essence of spas in Bali.”
The Chairman of the Bali Villa Association, Putu Gede Hendrawan, said that the 40% spa tax will hugely impact tourists’ decision-making process in choosing a vacation destination.
He told reporters “we are struggling here with the increase in spa taxes, while other countries are taking advantage of opportunities, take advantage of loopholes, they are actually lowering taxes.”
Hendrawan is asking the government “Why is there an increase in spa tax? What is the aim?”
He added that regarding the study of the inclusion of spas as objects of a 40% tax, we are all shocked, not even the GIPI knew about it, that was surprising.”
With such huge concerns being voiced by key industry leaders in Bali there are hopes that the 40% tax on spas and other entertainment venues will be addressed quickly and changed to be in alignment with other hospitality taxes in Indonesia.
In the meantime, tourists must prepare to see the cost of spa experiences in Bali increase massively. It will be advisable to ask before receiving a treatment whether the prices on the treatment menus include taxes or whether additional fees will be added at the point of payment.
Many tourists feel that Bali is no longer the cheap and cheerful travel destination it has long been thought to be. With the introduction of the tourism tax, visa fees, top attractions hiking entry ticket prices and now increased taxes on entertainment, tourists will need to be budget-savvy in Bali in 2024.
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Oliver
Monday 15th of January 2024
shooting oneself in the foot once again ! Clearly some decision makers should be assigned to beach management instead.
Jeff
Monday 15th of January 2024
The men in this country are pretty honest people. Its their greedy women who control them, who demand all the tax increases for new Gucci Bags, luxury face whitening treatments fancy cars and holidays. I feel sorry for these kind and gentle fellows.
Mr Bear Snr
Sunday 14th of January 2024
A friend of 20 years has just finished completely rebuilding her spa after it was vandalised. She will lose everything as the tax increases will remove any chance of her repaying the loan she was forced to take out. 4 more woman out of work and a bankrupt family.
Thommo
Saturday 13th of January 2024
Its embarassing how inept and non consultative the Balinese and Indonesian governance is. This 40% hike in tax proposal for spa/ wellness industry is beyond comprehension. Parallels the intended exponential increase in fees for Komodo National Park that would have killed tourism in Flores. This male dominated corrupt governance is destroying credibility on every front.
Paul
Saturday 13th of January 2024
After COVID for more than 3 years, now this industry is hit by the highest tax in the world. This is going to be the end for many. Who’s idea was it to send so many local people out of a job?
Exp
Sunday 14th of January 2024
@Paul, @Thommo, This law is coming from central (Jakarta).
Could be the law came around after lobby work from groups who are focused on high alcohol taxes or outright ban on alcohol and other vices.
Another driver is the fact the "entertainment" tax is the 3rd largest contributor (income) to Jakarta, so this idea of milking the "entertainment" business is now becoming a national target.