PAY YOUR WAY

Tourist destinations are trying to deter “low value” travelers with new taxes

Pay up.
Pay up.
Image: Reuters/Manuel Silvestri
By
We may earn a commission from links on this page.

Countries and cities have generally tried to encourage tourism—based on the premise that holidaying visitors and the money they spend fosters economic development.

But in the age of overtourism, some popular destinations have reached their limit. City centers are clogged with avocado-toast-seeking hoards, historic sites are trampled by selfie-stick toting visitors, and locals are priced out by rising rents. To add insult to injury, many of these tourists don’t spend much money: They use apps to sleuth out super-budget deals, disembark from cruise ships with full bellies to stroll around and then return to their buffets and cabins, or forgo hotels for cheaper accommodation in neighborhoods that were once solely the domain of locals.

That’s why so-called tourist taxes are cropping up in destinations around the world. On the surface, these taxes—which can be levied through the visa process, as a stand-alone fee at the airport, or as part of your air or cruise ticket—are nothing new. But historically, they have been used to fund tourism boards, hospitality trade groups, and destination marketing campaigns—the point being to bring more people into the country down the line.

But a slew of new tourist taxes, or plans for them, in Venice, Amsterdam, Bali, Edinburgh, and New Zealand are taking an opposite tact: They’re using tourist tax revenue to both help the destination control the effects of overtourism, and also to disincentivize certain kinds of travelers.

Elizabeth Becker, the author of Overbooked: The Exploding Business of Travel and Tourism, says the rise of these taxes suggests governments are starting to see that when it comes to tourism, you can have too much of a good thing.

“It’s only in [the] last few years you have tourism taxes that are going to controlling tourism,” Becker said. This is because more and more destinations are recognizing that “there is no getting around the fact that there is a carrying capacity.”

Many of these measures aren’t simply centered on driving down numbers, but rather, attracting a “that lower impact, higher value traveler,” she said—one that is going to spend some money, in addition to using resources or crowding the destination. She cites the example of Venice, which for years did little to stem the tide of visitors displacing locals. Now, in addition to a new tourist tax, the mayor has rolled out new measures meant to moderate tourists’ behavior and their effect on the city.

So how do these taxes work to deter “low value” tourism? Amsterdam provided an instructive example at the beginning of January when it implemented a day tourist tax of €8 ($9) per person. About a week later, two cruise lines announced they would no longer be stopping in port, and two more lines followed suit in February. These cruise ship “day-trippers” don’t stay in a hotel or eat much at local restaurants (why would you, when you have an all-you-can-eat buffet waiting for you on board?), and are generally in and out of the destination quite quickly. Though the tax—equivalent to the cost of a couple of beers—is relatively small, it was enough to put off extremely price-sensitive cruise lines. And it gave Amsterdam an effective way to say, “Thanks, but no thanks.”

Not all these tourist taxes are meant to discourage tourists altogether from visiting. Bali—which has seen a huge uptick in visitors since it starred in Elizabeth Gilbert’s 2006 travel memoir Eat Pray Love—is one of the destinations mulling a tax. The roughly $10 fee will be used to preserve the environment and Balinese culture, which has been overrun with yoga retreats and acai bowl cafes. The Jakarta Post reports that officials aren’t trying to drive away travelers, mostly from Australia and China, but see this as a way for travelers to “contribute to preserving” the local culture.

Overtourism is often oversimplified, and it’s easy to blame the tourists themselves, or industry-disrupting companies such as Airbnb. But factors such as the rise of low-cost airlines, the growth of the cruise industry, and the failure of some governments to put constraints on growth are often underplayed, Becker says.

And as the democratization of travel continues, officials will continue to face the same conundrum: Can a destination benefit from tourists without completely destroying what made it appealing in the first place?