Asia
Concern in Bali: Indonesia increases entertainment tax
View of the famous rice fields on the Indonesian holiday island of Bali. photo
© Carola Frentzen/dpa
In a month, Bali will introduce its much-discussed tourism tax. Now the entertainment tax has also been increased drastically. The travel industry is worried – and is looking anxiously to Thailand.
Bali’s tourism industry is concerned about the massive entertainment tax hike pushed by the Indonesian government. This was increased nationwide from the current 10 to 35 percent to 40 to a maximum of 75 percent, as the newspaper “Bali Sun” reported. The so-called goods and services tax for the entertainment sector (PBJT) has been in effect since January for discos, karaoke bars, nightclubs, bars and spas – and is added to holidaymakers’ bills.
“No doubt budget-conscious Bali fans will now look for other holiday destinations,” the paper wrote. From mid-February, the government will also levy a tourist tax that every foreigner has to pay when entering the country. 150,000 Indonesian rupees (around 9 euros) are due, in addition to the 500,000 rupees (30 euros) for a 30-day visa. The “tourism tax” also applies to children. Anyone who takes a detour to neighboring islands such as the Gili Islands, Lombok or Java will have to pay again on the return journey to Bali. Up to 70 percent of the money from the tourism tax will be used to solve the island’s waste management problems.
Reverse laws in Thailand
Indonesian Hotel and Restaurant Association Chairman Hariyadi Sukamdani called for a judicial review of the entertainment tax increase law. He said the affected companies were excluded from the legislative process. “We have no choice but to file a lawsuit with the Constitutional Court because our colleagues in Bali are already feeling the effects,” the Jakarta Globe newspaper quoted him as saying.
Experts warned that Bali could now lose visitors, especially in view of its competitor Thailand. At the beginning of the year, the government in Bangkok gave the green light to a drastic tax cut on alcoholic drinks and entertainment venues. Taxes on wine and entertainment venues are to be reduced from ten to five percent. Thailand is currently taking numerous measures to boost tourism after the corona pandemic.