The Denpasar administration’s plan to triple the amount of money businesses would have to pay to acquire or extend a license to sell alcoholic beverages has angered the local tourism association.
The association claimed that the new policy would likely increase the street prices of alcohol and warned that the resort island already had tight quotas on liquor sales as well as higher license fees compared with other tourist destinations in the region.
“Prices of alcoholic beverages in Bali are 1.5 to two times more expensive compared with Singapore and other countries. With this sudden increase in the licensing fee, how are we supposed to adjust the prices?” said Ida Bagus Gede Sidharta Putra, chairman of the Denpasar branch of the Indonesia Hotels and Restaurants Association (PHRI), on Wednesday.
The head of the city’s licensing agency, AA Gde Rai Soryawan, had revealed that the city’s administration would impose a new, higher tariff policy on licenses to sell alcoholic beverages. The license is valid for five years and for one, specific site only. The new tariff will affect all business entities applying for a new license or extending an old one. The new tariff policy is due to come into effect in February.
According to the new tariff, a starred hotel will have to pay Rp 5 million (US$520) to acquire the license to sell alcohol at one specific outlet on its site. Previously, the same license only cost Rp 1.5 million.
Non-starred hotels will have to spend Rp 2.5 million, a significant hike from the old tariff of Rp 750,000.
The highest increase will affect duty-free stores. Under the old tariff, a license cost a duty-free shop Rp 2 million. According to the new tariff, however, the license will set all owners of such stores back Rp 7 million.
The more than 75 per cent increase in license fees will also affect pubs, bars, cafes, restaurants and any supermarkets that sell wines and spirits. Pubs and bars will have to pay Rp 1.5 million for a license, restaurants and cafes Rp 2.5 million, while supermarkets and independent retailers will have to fork out Rp 5 million.
Soryawan said the alcoholic beverages covered by the new tariffs were Class B beverages (5 to 20 per cent alcoholic content) and Class C (20 to 55 per cent alcoholic content).
“Class A category beverages [alcoholic content of 5 per cent or lower] are not covered by the new tariff,” he said, adding that the increase had been based on academic research, including the health and social impacts of alcohol.
He highlighted that this increase was not merely aimed at generating higher revenue for the city, but also at controlling the sale of alcoholic beverages.
