Studies highlight verification gaps in Bali’s digital tourism tax systems

Badung — — Digital reporting and automated collection are helping modernise tourism tax administration in Bali, but weaknesses in data verification and supervision remain, according to two academic studies published in September 2025 and July 2026.

One comparative study drew on 200 validated responses from tourism businesses in Indonesia and Australia and found that digital transformation was positively associated with taxpayer compliance in tourism taxation.

The research does not quantify current hotel and restaurant tax revenue for Bali or Badung.

Instead, it points to an administrative challenge: digital systems can make reporting faster and more systematic, but their effectiveness depends on data quality, institutional monitoring capacity and the readiness of businesses to use the systems properly.

Findings from Badung’s hotel tax case study

A case study of The Stones Legian Bali, published in the September 2025 edition of Widyanata, analysed the implementation of Badung’s hotel tax rules through interviews, observation and documentation at the hotel and the Badung Regional Revenue Agency.

The study reported that hotel tax regulations were being implemented through online reporting (e-tax) and automatic tax collection, and described these arrangements as supporting tax administration.

However, it also found obstacles in verification and oversight, including discrepancies between hotel transaction records and data in the e-tax system, and noted the need for stronger supervision and data checking.

The Widyanata paper situates the hotel tax within Badung Regional Regulation No. 15 of 2011 on hotel and restaurant taxes, under which hotel businesses collect tax from users of accommodation, food, beverages and other facilities before remitting the proceeds to the regional treasury.

The study cites Badung’s regional revenue agency in stating that hotel and restaurant taxes are among the main sources of locally generated revenue, but it does not specify a year or detailed methodology for the percentage contribution.

Separate reporting by the Audit Board of Indonesia’s Bali office in early 2024 similarly identified hotel and restaurant taxes as leading contributors to Badung’s regional tax revenue, with hotel tax accounting for more than half of total local tax receipts that year.

Comparative study: Bali and Australia’s Gold Coast

The comparative study by Fatmawati Zahroh and Ranjith Ihalanayake, published in Keunis on 2 July 2026, examined digital transformation in tourism taxation in Indonesia and Australia “from Bali to the Gold Coast”.

Drawing on 200 validated responses from tourism sector taxpayers, the authors found that digital transformation and monitoring and anti-leakage mechanisms both had a positive and statistically significant effect on taxpayer compliance in both jurisdictions.

The study also reported that institutional capacity strengthens the relationship between digital transformation and compliance, acting as a moderating factor in the model.

According to the authors, technologies such as AI-based compliance tools, blockchain for transaction verification and data analytics for risk management are being explored in tourism tax systems, with real-time digital verification highlighted as a potential way to reduce tax leakage when combined with adequate skills, leadership and infrastructure.

A multi-group analysis in the same paper concluded that the Gold Coast is more affected by digital maturity and institutional capacity than Bali in the model, but this is presented as an econometric finding rather than a direct ranking of overall tax administration quality.

Implications for tourism businesses and authorities

For hotels, the Badung case study suggests that electronic reporting does not remove the need to reconcile internal operational records with tax declarations, because mismatches between a property’s system and the government’s e-tax platform can create verification issues.

The findings are relevant beyond large hotels: any tourism business that reports taxable transactions digitally may see benefits in consistency and speed, but still face risks from incomplete coverage, weak connectivity or limited staff capacity.

For local authorities, both studies underline that automation should be accompanied by integrated supervision.

The Widyanata paper recommends improving monitoring and taxpayer awareness to address verification and oversight gaps in Badung’s hotel tax system.

The Keunis study indicates that institutional capacity and monitoring mechanisms are critical to turning digital transformation into effective compliance gains.

Taken together, the research points to a practical distinction: digital tools can improve the speed, traceability and administrative efficiency of tourism tax collection, while verification, supervision and institutional capability determine whether reported transactions accurately reflect activity on the ground.

Key data points

• 200: Number of validated tourism taxpayer responses in the Bali–Gold Coast comparative study.
• September 2025: Publication month of the Badung hotel tax case study in Widyanata (Vol. 22 No. 2, dated 30 September 2025).
• 2 July 2026: Publication date of the comparative study in Keunis (Vol. 14 No. 2).
• 2011: Year of Badung Regional Regulation No. 15 on hotel and restaurant taxes.

Context: Badung as a tourism tax hub

The Stones Hotel – Legian, Bali, the focus of the 2025 case study, is located in Legian in Kuta subdistrict, within Badung Regency, a major tourism area that includes Kuta, Seminyak, Legian, Jimbaran and Nusa Dua.

The Widyanata paper links Badung’s concentration of hotels and restaurants to the importance of hotel and restaurant taxes in the regency’s locally generated revenue.

National fiscal data for 2010–2019 compiled by the Ministry of Finance show substantial hotel and restaurant tax receipts for Badung over that period, reflecting the regency’s role as a core tourism centre in Bali.

Both the Badung case study and the Bali–Gold Coast comparison conclude that digitalisation can support tourism tax compliance, but is not a substitute for reliable data, capable institutions and active oversight.

Sources

• Keunis Vol. 14 No. 2 (2026): From Bali to the Gold Coast: A Comparative Study of Digital Transformation in Tourism Taxation of Indonesia and Australia
• Widyanata Vol. 22 No. 2 (2025): IMPLEMENTASI PERATURAN PAJAK HOTEL PADA HOTEL THE STONES LEGIAN BALI DALAM MENINGKATKAN PENDAPATAN ASLI DAERAH KABUPATEN BADUNG
• SINTA profile for KEUNIS journal
• Ministry of Finance Directorate General of Fiscal Balance hotel-restaurant-entertainment tax dataset 2010–2019
• BPK Bali media summary: Badung receives Rp 5.6 trillion in tax revenue, hotel and restaurant tax as major contributors
• Traveloka listing for The Stones Hotel – Legian, Bali
• WhatsNewIndonesia listing: The Stones Hotel – Legian, Bali