Mangrove Ecotourism Business Survival Strategy and the Impact of the 12% Value Added Tax (VAT) Increase

Abstract

This paper examines the implications of a 12% Value Added Tax (VAT) increase on the sustainability and operational strategies of mangrove ecotourism businesses in Indonesia. Mangrove ecosystems are essential for environmental balance and biodiversity, providing unique opportunities for ecotourism that can benefit local communities economically while promoting conservation. However, the recent VAT hike poses significant challenges, potentially increasing operational costs and affecting profitability. Through qualitative research methods, including in-depth interviews, focus group discussions, and direct observations, this study explores the experiences and adaptive strategies of stakeholders involved in mangrove ecotourism. The findings reveal that the VAT increase can lead to higher costs for materials, maintenance, and promotion, compelling businesses to reconsider their pricing strategies and operational models. Despite these challenges, the research highlights that businesses are motivated to innovate and adopt sustainable practices to maintain competitiveness. Key strategies identified include enhancing community engagement, leveraging government support, and intensifying marketing efforts to attract visitors. The study underscores the importance of collaboration among stakeholders to navigate the complexities introduced by the VAT increase. Ultimately, this research contributes valuable insights into the resilience of mangrove ecotourism in the face of economic pressures, emphasizing the need for sustainable management practices that ensure the long-term viability of both the businesses and the ecosystems they depend on.