Bali Looks to Battle Water Crisis With Tax Hike Made Arya Kencana | October 06, 2010

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Denpasar. A water crisis has highlighted the struggle Bali faces to provide the basics for residents and the millions of tourists from around the world who come to the resort island each year.

Now authorities in Bali have announced they will raise the groundwater tax by 1,000 percent in an attempt to curb consumption.

While the increase is for everyone, officials have made clear they hope it serves to encourage a decrease in the excessive use of groundwater by the tourism industry, which has brought jobs and revenue to the island but also has burdened its resources.

“We hope with a tax hike, hotels and restaurants will implement water-efficiency programs,” Bali Governor Made Mangku Pastika said on Wednesday.

He said the tax increase was based on a 2009 gubernatorial decree on the price of water.

Pastika said up to 5.3 million cubic meters of water were used annually, while the island’s annual water supply was just 4.7 million cubic meters.

“Take a look at the rivers and lakes in Bali, their water volume is decreasing by the day.”

Pastika said the revenue from the higher tax would be used for reforestation and conservation programs to help renew water sources.

“The hotel industry must be able to reduce water usage by recycling wastewater or filtering it and using it to water hotel gardens,” he said.

In Denpasar, the water crisis has hit most parts of the city, especially housing complexes located on higher ground.

Pastika said the crisis had occurred because the state water supply company, PDAM, only had limited supplies.

“We are forced to distribute the already limited supply of water to many customers,” said Maha Putra, director of PDAM’s Denpasar office.

Nyoman Sunarta, an environmental hydrology researcher at Udayana University, said recently that excessive exploitation of groundwater had led to seawater intrusion, and this would eventually pollute groundwater reservoirs in residential areas.

Sunarta said one reason for the water deficit was the conversion of rice fields into housing complexes and resorts.

He said his research projected Bali would suffer an annual water deficit of up to 27.6 million cubic meters by 2015.

Ida Bagus Ngurah Wijaya, chairman of the Bali Tourism Board, said such a large increase in the groundwater tax would place a massive burden on the tourism industry.

Hotels currently pay a maximum of Rp 3,000 (33 cents) for a cubic meter of water, but if the tax hike is implemented, many hotels would have to pay billions of rupiah every month.

I Made Arjaya, a member of Bali’s provincial legislature, demanded the tourism industry be allowed to convey its objections before a final decision was made on the new tax.