The Indonesian government has made its decision: Airbnb will not be banned. This is a lucid move that avoids sending a disastrous economic signal to foreign investors. However, let’s be clear: while banning the app would have been a mistake, allowing the status quo to continue would be suicide for the local tourism industry.

The problem in Bali isn't the technology platform. The problem is the underground industrialization of hospitality.

In Bali, the reality of Airbnb is vastly different from that of Europe or the US. We are not dealing with locals renting out a spare bedroom to make ends meet.

We are facing a model dominated by Professional Management Companies. These agencies manage portfolios of 20, 50, or even 100 villas, operating them like deconstructed hotels. They offer full hotel services—staff, daily housekeeping, concierge—yet they operate in a total legal grey area. They are essentially hotel chains that refuse to admit it.

The heart of the conflict isn't technological; it is fiscal and normative.

On one side, traditional hotels are subject to draconian standards: fire safety, water treatment, expensive commercial licenses, and most importantly, transparent taxation.

On the other hand, the villa market often operates under inadequate licenses, such as the Pondok Wisata (originally designed for small, family-run homestays), or sometimes without a license at all. This creates a massive imbalance:

• The PB1 Evasion (Hospitality Tax): While hotels remit 10% of every night’s stay to local governments, a vast portion of the villa market escapes this collection. This deprives Bali of essential revenue needed for infrastructure (waste management, roads, water).

• Land & Building Tax (PBB): These commercial villas often continue to pay land tax at residential rates, which are significantly lower than the commercial rates that should apply to their actual business activity.

Since the government has chosen not to shoot the messenger (Airbnb), it must urgently address the message. Simply asking for a "license number" isn't enough, because the current licensing categories no longer accurately reflect the market reality.

We need to create a proper framework for these "Villa-Hotels." The upcoming work on compliance is colossal:

• Reforming Categories: We need a clear legal status for luxury villa rentals that is neither a simple "Homestay" nor a massive "Star Hotel," with strict health and safety obligations.

• Fiscal Equality: Platforms should be mandated to collect the Hotel Tax (PB1) at the source, just as VAT is collected in other countries.

• Accountability for Managers: Management Companies can no longer hide behind property owners. As commercial operators, they must be held responsible for the compliance of the assets they exploit.

The government was right to protect business freedom by keeping Airbnb. Now, it must have the courage to enforce the same rules for everyone. You cannot manage a world-class destination using residential neighborhood regulations.