BADUNG, Bali – Ban Airbnb in Bali has become a serious policy direction after Governor Wayan Koster announced plans to halt Airbnb-style accommodation services, arguing the platform fails to contribute to the island’s locally generated revenue (PAD). He said the rapid growth of short-term rentals has eroded tax income, particularly from the hotel and restaurant sectors that form Bali’s primary revenue base.

Speaking at the 15th Regional Conference of the Indonesian Hotel and Restaurant Association (PHRI) Bali in Denpasar on Wednesday, 3 December 2025, Koster said more than 2,000 unlicensed hotels and villas continue to operate across the island.

“It will be reviewed, and we will propose for it to be stopped. Airbnb does not fully support Bali’s local economy. Many are illegal and problematic, and we will enforce strict measures—no exceptions,” he stated.

PHRI Bali Chairman Tjok Oka Artha Ardana Sukawati added that PHRI currently has 378 registered accommodations, a small fraction compared to an estimated 16,000 units operating online through various platforms. He said many Airbnb practices involve foreign nationals renting local homes and then re-listing them as daily rentals.
“The rise in tourist arrivals is not linear with PAD growth or hotel occupancy,” he said.

Airbnb Practices Need Tighter Regulation

Data from the Bali Regional Office of the Directorate General of Treasury shows that PAD realization as of October 2025 reached Rp 15.3 trillion, or 71 percent of the Rp 21.5 trillion target—an annual growth of 9.58 percent. Regional taxes account for the largest share, totaling Rp 12 trillion, including Rp 7.13 trillion from specific goods and services taxes (PBJT), which grew 14.76 percent year-on-year.

PBJT covers food and beverage services, hospitality, arts, and entertainment—sectors increasingly disrupted by the shift toward online-based short-term rentals. PHRI Central Board officials say Bali may need regulations similar to Singapore’s to establish legal certainty.

Learning from Singapore

PHRI Chairman Hariyadi Sukamdani explained that in Singapore, daily rentals must be operated as hotels, while apartments can only be rented if the stay exceeds three months. Residents are also encouraged to report illegal short-term rentals to authorities.
“This system keeps Singapore’s hotel occupancy at around 78 percent, even though room rates are high,” he said.

He hopes Indonesia—particularly Bali, whose economy relies heavily on tourism—will adopt similar rules to address declining occupancy among licensed hotels.

Bali’s Current Hotel Occupancy Rate

Hariyadi noted that many unlicensed accommodations are operated by foreign nationals through profit-sharing arrangements with global digital platforms.
“The problem is that they do not operate under proper accommodation service standards. The sharing economy has become a challenge in many countries,” he said.

According to Tjok Oka, Bali’s current average hotel occupancy rate is around 60 percent, which does not align with the surge in international arrivals in 2024 that reached 6.3 million visitors, surpassing pre-pandemic levels.