A RELATIVELY NEW CONCEPT OF TAX
The concept of a tourist tax, which involves visitors being levied to contribute to local infrastructure and services, is a relatively new concept of tax that has recently gained traction across various destinations all over the world. In light of this, several European destinations now include a form of this tax. These include several historic cities and high-profile destinations. These now include Venice and Barcelona, which have recently introduced the tax for visitors. Cyprus, however, remains defiant and has no immediate plans to implement one.
A TAX THAT VARIES WILDLY
Normally levied through the type of accommodation, there currently seems to be no control over the amount charged. Tourist taxes can vary wildly because of this, often creating a confusing minefield of charges for most travellers that only realise that there are extra charges when it is too late. Some travellers, however, who have had their fingers burnt in the past, are now backing away from this trend. They are now found seeking more value-for-money destinations that have no additional extra charges. This has led to questions being raised as to whether this tax model is still sustainable moving forward.
A REDUCTION IN TRAVELLER NUMBERS
The introduction of new entry controls at European Union borders has recently seen the overall cost of travelling to Europe increase. This, in addition to the various tourist taxes, has proven to negatively impact recent visitor numbers. This has prompted several analysts to remain sceptical as to whether certain taxes are still beneficial to local economies. It has been found that people seeking cheaper alternatives that have no taxes are now shunning tourist destinations that are still relying on large visitor numbers to maintain their local economies. This has helped to fuel concern that visitor numbers may dwindle further due to tax rises.
A CONSIDERATION OF TAXES
This view is also supported by recent surveys that have indicated that cash-strapped travellers are now seeking value for money above all else. Travellers now seem to be considering taxes for the first time when choosing where to travel to, and some holidaymakers specifically now only choose destinations that have no tax at all. It is thought that if this trend continues, then there will soon be a reduction in traveller numbers to destinations that operate a tourist tax.
CYPRUS HAS NO TOURIST TAX
Whilst the implementation of such a tax in Cyprus has been a subject of much discussion, there are no immediate plans to introduce one. Authorities maintain that balancing the need for increased revenue with the imperative to keep Cyprus competitive is paramount. Cyprus constantly relies on its tourism sector and Cypriot authorities have maintained that keeping Cyprus as appealing as possible is crucial for the island’s long-term prosperity. The absence of a tourist tax is an effort to maintain the attractiveness of the island for travellers seeking value-for-money vacation options. The overall view is that the island’s ‘no tax’ policy has not only enhanced the overall visitor experience but has also encouraged longer stays and increased visitor spending.
A GROWING DEMAND ON PUBLIC SERVICES
It is agreed that a tourist tax could theoretically further provide valuable funding for the enhancement of tourist facilities. This extra money could then be used to maintain natural resources and protect the cultural heritage of the island. Critics, however, argue that it is highly likely that imposing additional fees will deter potential visitors, negatively impacting a key sector of the economy. Although there have been proposals regarding the introduction of a Cypriot tourist tax, mainly to address the growing demands on public services and environmental preservation, local authorities have yet to reach a consensus. As the tourism landscape evolves, the consideration of a tax could emerge again, but for now, visitors can enjoy the charm of visiting Cyprus without the burden of a tourist tax.
A TOURISM BASED ECONOMY
Revenue from the island’s tourism sector has marked a significant increase in recent years. During this time, figures indicate that the average tourist spent just over €850 for the duration of their vacation in Cyprus. Tourists from Switzerland topped the spending list with an average total spend of nearly €1,200 per person. Visitors from Norway and Sweden followed closely with an average spend of just over €1,000 per person. The most budget-conscious tourists were from Greece with an average spend of just over €500 per person.
A BREAKDOWN OF SOME OF THE TOURIST TAXES CURRENTLY CHARGED AROUND THE WORLD
Switzerland
Charges vary across towns, cities and cantons. Taxes for camping are usually lower than hotels. Fees can also vary significantly, from around €3 up to €7 per person, per night.
Netherlands
Amsterdam currently charges one of Europe’s most expensive tourist taxes. This is set at 12.5% of overnight rates. Other towns and cities are free to set their prices as they please.
Belgium
Towns, cities and municipalities are free to set their tourism taxes as they please. These are applicable to all non-inhabitants of the area, whether or not they are Belgian. In some places, such as Antwerp and Bruges, the charge is a flat fee. Brussels bases its tax on the size and rating of the accommodation.
Austria
Known as the Beherbergungsbeiträge, the charge varies between towns and is applicable to tents and caravans, as well as hotels, holiday lets and B&Bs. In Vienna a charge is set at 3.2% of all accommodation bills.
Germany
Popular cities such as Frankfurt, Berlin and Hamburg set a tax at 5% of accommodation costs. Other cities such as Munich have no charge.
Czech Republic
The Czech capital Prague charges the highest rates. All tourists are expected to pay the equivalent of about €2 for up to 10 nights in the city. Other popular cities, such as Brno, charge a little less.
Hungary
Visitors to the Hungarian capital Budapest are charged an additional 4% on top of the per night cost of accommodation.
Slovenia
Charges vary between areas and are made up of a ‘tourist tax’, plus a separate ‘promotional tax’. The combined price usually equates to about €3 per person, per day.
Greece
‘Accommodation tax for tourists has been replaced with a new ‘climate tax’. This has increased the costs. Prices per person, per night, now start at €1.50, but can rise as high as €15. Rates are reduced during the off-season. Visitors to the islands of Santorini and Mykonos also face a €20 tourist tax at the port in the peak of the summer season.
Croatia
Rates vary depending on location and time of year. taxes are generally set at about €1 per person, per day, with reduced prices for children.
Portugal
Tourists can expect to pay between €1 and €2 per person, per night, but this is dependent on the accommodation type and the time of year. Taxes are capped however, after seven consecutive nights per stay and children are exempt from any charges.
Spain
Tourist taxes are only in place when visiting Catalonia and the Balearic Islands. Rates vary widely and are dependent on the time of year and type of accommodation. Visitors to Barcelona are charged up to €4 per person, per night in tax for a stay in a five-star hotel. In contrast, the tax in the town of Mogán, in Gran Canaria, requests just €0.15 per day, per person.
Italy
Taxes are included for visitors from more than 1,000 different areas all around the country. The range of charge is dependent not only on the area but the type of accommodation. Rates are usually between €1 and €5 per person, per day, but in some places, such as Rome, charges could be as high as €7 per person, per day.
France
All visitors are charged a tourist tax. The rate is set by local authorities and can range from as little as €0.20 to €5.00 per person, per day.
