Tourist Tax (City Tax)
Tourist tax (also called city tax, bed tax, accommodation levy, or visitor tax) is a government-imposed charge collected from guests staying in paid accommodation. The tax is typically calculated per person per night, per room per night, or as a percentage of the room rate, and varies by destination, property category, and sometimes season.
Who collects it
In most jurisdictions, the hotel or accommodation provider is responsible for collecting the tourist tax from the guest at check-in or check-out and remitting it periodically to the relevant municipality or tax authority. Some OTAs — notably Booking.com and Airbnb — have negotiated agreements with local authorities in select markets to collect and remit tourist taxes directly on behalf of properties, which simplifies compliance for operators but reduces visibility into tax flows.
Example
Amsterdam charges a tourist tax of 12.5% of the accommodation rate (applicable rate as of 2024). A guest paying €200/night would owe an additional €25 in city tax per night — a material addition that affects perceived price competitiveness on OTA search results.
OTA and distribution implications
- Price display: OTAs must decide whether to include tourist tax in the headline price or disclose it as a separate charge at checkout. Inconsistent display across platforms creates confusion for guests and can distort conversion comparisons between channels.
- Price transparency regulation: Growing regulatory pressure — including provisions under the EU's Digital Markets Act (DMA) and national consumer protection rules — increasingly requires that all mandatory fees, including tourist taxes, be included or clearly disclosed upfront in displayed prices.
- Multi-market compliance complexity: Hotels operating across multiple destinations must track a patchwork of rates, calculation methods, and remittance schedules. EU member states alone apply dozens of different municipal tax regimes with varying rules on who is liable and how the tax is calculated.
Related
See also: DMA (Digital Markets Act), Rate Parity, Agency Model, Merchant Model, Direct Bookings