Despite a surge in tourist arrivals, hotels in Badung, Bali, are seeing fewer heads on pillows. This puzzling contrast has raised alarms among local authorities, who now suspect a silent shift in accommodation preferences. Tourists, especially foreigners, are believed to be trading hotel stays for cheaper rooms in local boarding houses, undermining the region’s hotel industry and its potential to generate tax revenue.
Badung Deputy Regent Bagus Alit Sucipta, known as Gus Bota, confirmed that the regional government is now taking this issue seriously. “The point is how Badung can better tap into PAD potential by creating proper regulations,” he said in a press statement on Thursday, April 10, 2025. According to him, regulation is urgently needed, not only to boost revenue but also to ensure fair business competition among accommodation providers.
In response, the Badung administration will establish an Integrated Team for Optimizing Regional Tax Revenue. This team, composed of members from various local government agencies, will investigate and assess properties suspected of operating as unregistered accommodations. “The team will jointly inspect locations to verify whether they are boarding houses, villas, or hotels,” Gus Bota explained.
He emphasized that the government is committed to identifying income sources that may have previously gone unnoticed. To ensure a solid legal foundation, the local government will work with the Badung Regional House of Representatives (DPRD) to draft and pass new local regulations.
“In the beginning, there may be some pros and cons—we understand that,” he admitted. “But we are taking this step to ultimately improve the welfare of Badung’s residents.”
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Beyond just inspections, the integrated team will also monitor foreign nationals staying in boarding houses, which are not officially classified as tourism accommodations. Gus Bota stressed that boarding houses are meant for residents with Indonesian ID cards (KTP), not for visiting tourists. “Foreign tourists should not be allowed to live in boarding houses,” he asserted.
This push for regulation comes amid mounting concerns from hotel operators who are struggling to fill their rooms, even as visitor numbers remain high. Their suspicions were echoed by Badung Regent I Wayan Adi Arnawa, who has publicly questioned the tourism behavior shift. “Tourist numbers are up, but hotel occupancy doesn’t match expectations,” Adi said. “So, what’s going on? One of our suspicions is that many of our guests are staying in places that aren’t hotels.”
Adi went further to describe the growing presence of upscale homes and boarding houses catering to foreigners as troubling. He warned that these facilities not only reduce hotel business but also fail to contribute to regional tax revenue.
“According to Adi, the presence of luxury homes and boarding houses for foreign tourists is troubling. Not only do they fail to contribute to regional income, but they also reduce hotel occupancy rates—even though tourist arrivals are increasing.”
As tourism continues to be the backbone of Badung’s economy, the local government hopes this initiative will restore balance—ensuring both quality tourism and fair economic returns for the region.
