KYOTO, Japan >> The Kyoto city government began levying a tax last month on stays at hotels and other accommodations, seeking to capitalize on a surge in foreign tourists to support the city’s finances.
Municipalities with major tourist sites have increasingly adopted similar taxes as the nation’s shrinking population is expected to result in diminishing tax revenues.
On Oct. 1, the Kyoto Itoya Hotel displayed a tablet device on its front desk notifying guests of the new tax. All guests at hotels in Kyoto are subject to a tax of $1.80 to $8.95 per night depending on the accommodation rate, except for students visiting on school trips.
“The cost isn’t light if you stay more than one night,” said a 59-year-old homemaker from Izunokuni, Shizuoka Prefecture, visiting Kyoto to see her eldest son.
The number of tourists to Kyoto topped 50 million for the first time in 2008, with the number of foreign tourists staying overnight reaching 3.53 million in 2017, a roughly fourfold increase over 10 years.
However, the increase in tourists has resulted in such problems as overcrowded municipal buses and excessive noise from private lodgings.
Meanwhile, municipal tax revenues have stagnated despite the tourist boom as hotels pay most of their taxes to the prefectural and central governments. This prompted the city to introduce an accommodation tax as a source of additional revenue to combat problems related to tourism.
In 1985, the city government introduced a “tax to preserve the ancient capital,” which added 50 yen to the entrance fees for the city’s shrines and temples. The city was eventually forced to repeal the tax due to opposition from shrines and temples.
However, the latest accommodation tax has not encountered major opposition.
Zenzo Ono, 67, head of the association of hotels and ryokan operating in Kyoto Prefecture, expressed understanding for the new tax, saying, “The increase in tourists has caused problems for residents, so some measures need to be taken.”
The city government plans to use the estimated $41 million in new annual revenue for such purposes as refurbishing municipal bus stops.
The Tokyo metropolitan government introduced an accommodation tax in 2002, and the Osaka prefectural government followed suit in 2017. The Kanazawa city government plans to introduce such a tax in April, while the municipal governments for Kutchan, Hokkaido, and Atami, Shizuoka Prefecture, are considering adopting similar taxes.
In Kyoto, guests at private lodgings such as Airbnb are also subject to the accommodation tax, but the city faces challenges in collecting the tax from such operators.