What is tourist tax?

You arrive at your destination, drag your luggage into the hotel and ask to check in. You’ve already paid for your room, so you expect to just grab your room key and sail off for a kip – but instead you’re asked for yet more money: a tourist tax. Grudgingly, you hand it over, but walk away feeling cheated, and wondering: why did I have to pay a tourist tax when I’ve already paid for my accommodation and I’m here to spend money?

What is tourist tax?

Also known as a tourist levy or visitor tax, tourist tax is a fee imposed on tourists or visitors by local government to a particular destination, usually as an additional charge on top of the regular taxes and fees. It’s usually collected through hotels or accommodations, which then pay that money to the local government or tourism authority. This is not the same thing as a city tax – some destinations charge BOTH!

In a nutshell, city tax is typically levied by local governments to generate revenue and fund various city services and infrastructure projects. Tourist tax, on the other hand, is specifically imposed on visitors or tourists and is often collected to support tourism-related initiatives, such as marketing campaigns or improvements to tourist attractions. The rates and regulations for these taxes can vary from place to place.

Tourist tax helps to improve destinations

This tax is designed to help the destination by:

1. Supporting local infrastructure and services: The revenue helps fund the maintenance and improvement of public facilities such as parks, museums, restrooms, and transportation systems. Ultimately, this actually enhances your overall visitor experience and helps to ensure that the destination remains attractive and well-maintained.

2. Preserving natural and cultural heritage: Many popular tourist destinations have fragile ecosystems or historical sites that require ongoing conservation efforts, which costs a fortune, as you can imagine. The tourist tax helps finance these initiatives, ensuring that future generations can continue to enjoy and appreciate these natural and cultural treasures.

3. Offsetting the impact of tourism: As much as tourism is a boon to the economy, it also does place a strain on local resources, including water, electricity, and waste management systems. Funds can be used to help minimise any negative impact by supporting infrastructure.

4. Supporting the local economy: By creating employment opportunities, both directly and indirectly, the tax can help in boosting the local economy. The revenue generated can be invested in the development of tourism-related industries, supporting local businesses, and stimulating economic growth.

5. Promoting sustainable tourism: The introduction of a tourist tax can influence visitor behaviour by encouraging responsible travel practices. By making tourists aware of the costs associated with their visits, it encourages them to be more considerate of their impact on the destination and engage in sustainable activities.

Not every destination has a tourist tax and, when they do, the exact fee and allocation varies.

In some places, tourist taxes are included in the hotel or accommodation fees and are paid at the time of booking or during check-in. In other cases, it may be required to pay the tourist tax separately, either in cash or by other means such as credit card.

We recommend always checking before you leave if there is a tourist tax and/or city tax payable. More destinations are hopping aboard the tourist tax train, so the situation is always changing. That way you’ll know to expect it and it won’t come as a nasty surprise. Instead, you can rest easy knowing that you’ve done your part to actually help improve the place you’re visiting.

Bon voyage!

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