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Tropical island paradise ponders tax-free 'Digital Nomad Visa'

(2022/06/27)


The government of Indonesia has once again raised the idea of creating a "digital nomad visa" that would allow foreign workers to live and work in the tropical paradise of Bali, tax free, for five years.

The idea was raised before the COVID-19 pandemic, but understandably shelved as borders closed and the prospect of any digital nomads showing up dropped to zero.

But in recent interviews Sandiaga Uno, Indonesia's minister for Tourism and the Creative Economy, said the visa was back on the drawing board.

[1]

Uno's plan is for a visa that allows a five-year stay, provided those who take it up work for an entity outside Indonesia. Visa holders would pay tax in whichever jurisdiction they get paid, rather than in Indonesia.

[2]

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What's in it for the archipelagic nation? The cash digital nomads spend on their day-to-day expenses, that's what.

Bali's tourism industry is a massive contributor to Indonesia's economy and took a big hit during the pandemic. Luring cashed-up long-term residents to the island would provide years of income to local workers.

[4]Xiaomi adds earthquake alert system to some smartphones

[5]Indonesia's new mega-telco to build 18,000km submarine cable to the US

[6]Indonesia bars financial institutions from offering crypto services

Should you take advantage of more relaxed attitudes to remote work and apply for this visa?

Bali is certainly lovely, has an enviable climate (outside the wet season), brilliant surfing, excellent food, and a cost of living that's modest compared to Western nations.

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On the downside, the island's time zone is not the most convenient for daytime collaboration with colleagues in Europe or North America. If healthcare of a standard to compare with the aforementioned locales is important, you'll need to go private. Internet speeds are often modest. Roads are challenging.

And who can forget the active volcanoes, which between 2017 and 2019 erupted a handful of times and disrupted air traffic for a few days? Or the frequent earthquakes?

One more hazard: Australian tourists. When your correspondent last visited Bali, locals refused to believe I was Australian on grounds I was sober, civil, and wearing a shirt. Most who stay in Bali for more than a couple of weeks therefore avoid the tourist strips.

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Aside from that, though … ®

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[4] https://www.theregister.com/2022/04/05/xiaomi_indonesia_smartphone_earthquake_warnings/

[5] https://www.theregister.com/2022/02/11/acc_1_submarine_cable_usa_indonesia/

[6] https://www.theregister.com/2022/01/27/indonesia_cryptocurrency_trading_ban/

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[9] https://whitepapers.theregister.com/



I'd love to!

ShadowSystems

All I need is a passport, plane tickets (1st class natch!), and a fekton of cash to spend getting used to the area so I can then spend said funds doing touristy things. Restaurants, looking for a decent/cheap place to stay, determining what form of daily transportation I'll require for my needs, etc.

"But it's entirely digital, you don't need to actualy LIVE here!" Yes I do. I require (cough) much tropical sun, sandy beaches, salt water soakings, & fruity drinks delivered by nummy local nymphs as I "recouperate" on the beach, laptop on a stand beside me beneath a beach umbrella (do I have to, y'know, turn it ON?), and a good book to help me take long, recouperative naps in a climate more condusive to my mental health. =-D

Seriously, I'd love to move there. The weather is a dream, the cost of living reasonable, & except for the odd natural disaster, I could envision myself having a rather nice retirement there. Too bad I'm poor & couldn't afford to *swim* there much less fly there. *Comical pout*

A houseboat, a sheltered cove, & a hammock sounds like heaven...

Ol'Peculier

Ah, Bali. Basically Magaluf for Ozzies...

Recipe for resentment?

Warm Braw

As it happens, I recently met a group of tech people on a European holiday island with similar ideas - though with a "low tax" rather than a "no tax" offer. I think it's fair to say there was some disquiet amongst the locals that the "nomads" were pushing up the cost of housing while contributing less than a succession of tourists (you're not going to revisit the same attractions every fortnight) to the general economy and nothing at all to the development of a local tech economy as they were entirely divorced from it working for remote clients/employers. Which of course the locals could do equally as well, but would suffer a much higher tax burden for their identical effort.

Ultimately it's the same mistake the UK has made with non-doms: there's not much point in welcoming wealthy people into your country unless you tax them. Otherwise all you get is asset price inflation and nothing to compensate for it.

Re: Recipe for resentment?

AMBxx

Stage 2 - the new nomads have secure, gated housing developments

Stage 3 - resentment builds

Stage 4 - nomads build their own social stuff within their secure, gated areas

Stage 5 - sales of machetes increase

Green death

elsergiovolador

Yes, I can see all the creative people flocking to Bali when you can get executed for having a spliff.

Re: Green death

tiggity

Conservative culture not great if you are female also worth a mention (and various other fierce (beyond drug laws) laws that could catch people out

Yes, we will be going to OSI, Mars, and Pluto, but not necessarily in
that order.
-- George Michaelson