Badung’s Regional Revenue Agency has agreed to increase the entertainment tax rate, which is considered to be too low at its current rate. The head of the agency, I Made Sutama, said that he has suggested a maximum increase up to 25 percent from the current 12.5 percent. “The idea to have an increase makes sense because what we have now is very small,” Sutama said, as quoted by Bali Post.
According to Sutama, the tax boost will not significantly affect the number of visitors, especially since the people who go to entertainment spots in Bali come from an above average economic class. “I do not think it will have much of an effect because they already have their own market segment,” he added.
The purpose of the tax increase is to boost the region’s revenues from the entertainment sector. For 2018, the agency is targeting IDR53 billion revenue from the entertainment tax. This is a reachable sum considering the 49.9 billion revenue they got from entertainment tax in 2016.
Members of the House of Representatives have also previously suggested an increase of entertainment tax from 12.5 percent to 35 percent. Under Law No.28 Year2009 regarding Regional Tax and Retribution, places like nightclubs and karaoke bars could even be taxed as high as 75 percent.