Bali Considers RM446/Day Tourism Tax to Curb Overtourism

Bali, renowned for its picturesque landscapes and vibrant culture, has long been a magnet for global travellers. However, the island’s popularity has ushered in challenges related to overtourism, prompting local authorities to consider innovative solutions to preserve its unique environment and heritage. One such proposal under serious consideration is the introduction of a daily tourism tax for all foreign visitors, inspired by Bhutan’s sustainable tourism model.

Bhutan’s approach to tourism is characterised by a Sustainable Development Fee, where international tourists are required to pay USD 100 (RM446) per day. This model aims to attract ‘high-quality’ tourists who are willing to invest in the preservation of the country’s cultural and natural assets. Bali’s leaders, including notable figures such as former Tourism Minister Sandiaga Uno and Senator Ni Luh Djelantik, have expressed admiration for this model and are exploring its applicability to Bali’s context.

The current tourism tax in Bali, introduced in February 2024, mandates a one-time fee of IDR 150,000 (approximately RM41) per international visitor. This levy was intended to support sustainable tourism initiatives and infrastructure development. However, reports indicate that due to inadequate enforcement and communication, compliance has been suboptimal, with less than 40% of international arrivals paying the fee. This shortfall has prompted the Indonesian Ombudsman to initiate investigations into the management of the tourism tax system.

The proposed daily tourism tax aims to address these shortcomings by ensuring a more consistent and substantial revenue stream dedicated to environmental conservation, cultural preservation, and infrastructure enhancement. By implementing a daily fee, authorities hope to regulate tourist influx, mitigate the adverse effects of mass tourism, and promote a more sustainable and respectful interaction between visitors and the local community.

Globally, several destinations have adopted or are considering similar measures to combat overtourism. For instance, Venice has implemented a day-tripper fee ranging from RM5 to RM25, depending on the season, to manage the overwhelming number of visitors. Edinburgh has also announced plans for a tourism fee aimed at funding infrastructure and cultural initiatives. These examples highlight a growing trend among popular tourist destinations to leverage taxation as a tool for sustainable tourism management.

The potential implementation of a daily tourism tax in Bali has elicited mixed reactions. Proponents argue that it is a necessary step towards preserving the island’s ecological and cultural integrity, ensuring that tourism benefits are equitably distributed, and enhancing the overall quality of the visitor experience. Critics, however, express concerns that such a tax could deter budget-conscious travellers and negatively impact local businesses reliant on high tourist volumes. They caution that without careful planning and stakeholder engagement, the tax could lead to unintended economic consequences.

As Bali navigates the complexities of sustainable tourism, the proposed daily tourism tax represents a pivotal policy consideration. Balancing the economic benefits of tourism with the imperative to protect and preserve the island’s unique cultural and environmental assets remains a delicate endeavour. The outcome of this proposal will likely serve as a reference point for other destinations grappling with similar challenges in the pursuit of sustainable tourism development.