Bali. Foreign tourists visiting Bali are increasingly using illegal accommodations, leading to a decline in hotel and villa occupancy rates despite a rise in tourist arrivals. Many of these visitors are also reportedly running unlicensed travel businesses on the island.

According to Indonesia’s Central Statistics Agency (BPS), Bali welcomed 6,333,360 international tourists throughout 2024, up 20 percent from 5,273,258 arrivals in the previous year. However, this surge in foreign visitors has not translated into higher occupancy rates at licensed accommodations.

The occupancy rates of four and five-star hotels in January 2025 stood at around 60 percent, but dipped to roughly 50 percent in February

I Gusti Ngurah Rai Suryawijaya, Deputy Chairman of the Indonesian Hotel and Restaurant Association (PHRI) in Bali, confirmed the growing issue, but the exact financial losses remain unclear due to a lack of concrete data.

“They rent villas from local residents on a long-term basis and then commercialize them online. Payments go directly to their personal accounts, allowing them to avoid taxation,” he told Beritasatu.com on Wednesday.

These tourists also provide unauthorized airport transfers, often claiming they are picking up relatives.

“This is deeply concerning. Jobs that should belong to locals are being taken over by foreigners,” Suryawijaya added.

He stressed the need for the government to take decisive action against unlicensed accommodations, especially as hotels and restaurants are key contributors to Bali's regional revenue. Several gubernatorial and regional decrees have already been issued, but enforcement remains a challenge.

“The regulations are in place. What’s needed now is firm implementation to prevent foreigners from casually operating businesses in Bali without paying taxes,” he said.

The rise of illegal businesses run by foreign tourists is seen as severely damaging to local entrepreneurs.

“This practice is harmful, unfair, and distorts healthy competition,” he said.

Suryawijaya called on the Bali Governor to establish a dedicated tourism task force to monitor and curb business activities carried out by foreign nationals. He also encouraged community involvement in reporting such violations.

“There’s already a task force, but it hasn’t been very effective. An ideal task force should be capable of educating, engaging, and communicating with foreigners,” he said.

“If enforcement is left solely to the municipal police, they may face language barriers. The task force should at least be proficient in English or other foreign languages,” he concluded.