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“One hundred square meters per guest”: how the new tourist tax will work

Date: July 6, 2024 Time: 10:57:01

From 2025, the resort fee will become a tourist fee.

Photo: Shutterstock.

Bills on further tax changes are being prepared little by little. More and more details are emerging. The Ministry of Finance presented its proposals for a tourist tax on Wednesday. What are they? How much will hotel and holiday home customers have to pay? And where will the money go?

From 1 to 5% per day

As with other tax changes, a new tourism tax will be introduced starting in 2025. Any region can enter it at its discretion. Moreover, all the money raised will go to local budgets.

“The tax will be paid into the budget at the location of the hotels: in this way the municipalities will receive an additional source of funding for the development of the municipality,” the Ministry of Finance clarified.

There is logic in this decision. After all, the situation now seems paradoxical. Let’s say that hundreds of thousands of tourists come to a particular city every year (say Murom, Suzdal or Sheregesh). This is a burden on the local infrastructure. After all, roads need to be repaired more often, garbage removed and attractions and other public spaces kept in decent condition. And the money is allocated for this based on general standards calculated from the number of local residents, not visitors.

Yes, the municipality receives part of its profits from local entrepreneurs who make money from tourists. But almost all of its taxes go to Moscow and regional centres. Therefore, local authorities have no incentive to develop tourist infrastructure. You will spend more money, there will be even more tourists, but income will not increase.

The new tax should change this situation. It will be levied on the cost of accommodation. It will basically work like a sales tax. In 2025 it will be 1% and in five years it will grow to 5% (for more details, see the chart). For example, if a hotel room costs 3,000 rubles, for each day of stay the tourist will pay another 30 rubles. And if the room costs 10 thousand, then the additional fee for each day will be 100 rubles.

At the same time, each region will be able to decide independently how much it will charge tourists for this tax. And will it happen in principle? The same freedom of choice exists today. Some regions have the right to introduce a tourist tax. Somewhere they charge 30 rubles per day, somewhere – 100 rubles, and somewhere (for example, in Crimea) they have completely waived this fee.

How much can they raise?

According to the Ministry of Economic Development, there are currently about 26,000 legal hotels operating in Russia. First of all, the tax changes will affect them. But the new bill interprets the list of those who will have to pay the tourist tax much more broadly. This includes both legal entities and individuals providing accommodation services. That is, private owners (those who rent out apartments on a daily basis) may also be subject to the new tax. How exactly it will be calculated is an open question. But, if the owner uses the services of travel aggregators, it will not be difficult to add a new tax to the price.

However, even the turnover of legal hotels will allow them to collect a fairly decent amount. According to the Russian Union of Travel Industry, last year Russians spent about 358 million nights in hotels. The average cost of a room is about 5,000 rubles per day. Thus, next year the total revenue from the tourist tax could reach up to 18 billion rubles. But this is provided that the tax is introduced in all regions without exception.

Where does the money go?

Experts believe that local budgets will receive much more money than they do now. This is shown by the latest data on the payment of the tourist tax. It was introduced as an experiment in 2018. But at the same time they limited the number of regions where it could be used. In fact, it is charged only in St. Petersburg, the Syrian Federal Territory, Krasnodar, Stavropol and Altai Territories. And even there, not everywhere, but only in the most touristic places.

However, last year alone, tourist fees brought 1.6 billion rubles to local budgets. And this year the fees will rise to at least 1.9 billion rubles, according to the government’s calculations. From April 1 of this year, St. Petersburg joined the experiment. And in the northern capital they did not waste time on trifles. There the resort fee is 100 rubles per day per person (this is the maximum). As a result, the city on the Neva plans to receive at least 300 million rubles in the treasury.

All the money received from the resort fee is allocated to specific expenses, i.e. the development of tourist infrastructure. As explained in the Cabinet of Ministers, in recent years 95 tourist infrastructure facilities have been designed, built, reconstructed, landscaped and repaired with funds from the tourist tax. In another 50 places work is already underway or is planned for this year.

This rule will not change with the replacement of the resort fee with a tourist tax. The money will remain in local budgets and must be spent solely on tourism purposes.

LIKE THEM

By the way, the tourist tax is not our invention. In most countries that make money from the influx of guests, such rates exist. Rates vary. On average in Europe you will have to pay 3-7 Euros per day. But in some places the rates are fixed, and in others they amount to 3-4% of the cost of living. In New York, the so-called “city tax” on hotels is 15%.

On the Indonesian island of Bali, which is popular with Russians, the tourist tax is 10 dollars. It is paid upon entry. The money is used to fight against environmental pollution. But the champion in compulsory collection of guests is the kingdom of Bhutan. They are sensitive to nature and local traditions. Therefore, only wealthy tourists who are willing to pay at least 200 dollars for a night’s stay are allowed into the country.

How will the tourist tax rate increase?

Year – Rate*

2025 – 1%

2026 – 2%

2027 – 3%

2028 – 4%

2029 – 5%

*These are the maximum rates. Each region may independently reduce them or completely refuse to charge the tourist tax.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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