Let me tell you about the new “Tourist Tax” introduced by Nagasaki City in April 2023. This tax will be taken when an individual goes on a trip. This tax is supposed to be used to promote tourism, but what exactly does it entail?
Taxable subject and tax rate
The tax is levied on inns, hotels, simple lodging houses, and facilities related to the residential accommodation business. The tax rate varies depending on the room charge.
Nagasaki City
| Lodging amount (per person) | Tax Amount |
| Under 10,000 Yen | 100 Yen |
| Over 10,000 Yen and under 20,000 Yen | 200 Yen |
| Over 20,000 Yen and over | 500 Yen |
The topic was how much money would be taken when introducing the taxation.
Considering the local consumption tax, we have introduced the tax after adequately responding to the argument that the tax would be imposed twice.
It is surprisingly low. The taxation is at the same level as other municipalities.
Tokyo Metropolitan Government
| Lodging amount (per person) | Tax Amount |
| less than 20,000 Yen | 200 Yen |
| 20,000 Yen or more | 500 Yen |
The taxable amount and tax rate of the lodging tax in Tokyo are shown in the table below.
Osaka Prefecture
| Lodging amount (per person) | Tax Amount |
| less than 7,000 yen | NA |
| 7,000 yen and over but less than 15,000 yen | 100 Yen |
| 15,000 yen or more but less than 20,000 yen | 200 Yen |
| 20,000 yen or more | 300 Yen |
What is taxable?
When classified as a consumption tax, the topic was raised about taxable items.
The following items are subject to accommodation charges. Even if the names are slightly different, they are subject to the tax. Also, there is an assumption that these items are taxed regardless of the guest’s intention.
What is included?
- Accommodation charges
- Bedding
- Bathing fee
- Bedclothes
- Cleaning fees for so-called “private accommodations” are included.
- Service charges, including service charges, etc.
What is not included?
- Food and beverages served at the accommodation
- Game fees
- Use of meeting rooms, rest, etc.
- Taxes include consumption tax, local consumption tax, bath tax, accommodation tax, etc.
- Advances in cars, cigarettes, telephones, dry cleaning, souvenirs, etc.
- Amounts of gratuities, tips, congratulatory gifts, etc., paid voluntarily by guests.
Who pays
The person who pays in the sense that the general public thinks is who stayed at the hotel.
However, as with the bath tax, the lodging business pays the tax to the City of Nagasaki.
The image of the mechanism is similar to the consumption tax.
How is the taxation reported?
When a business pays the tax, the tax is reported and paid.
Let’s look at an example from Osaka Prefecture.
As shown here, taxation is done by reporting the amount of lodging and the number of persons.
Since it is deposited and paid, the technical term is called a unique collection.
Impact on Businesses
For businesses subject to the tax, this will mean an increase in new burdens. On the other hand, if the tax is used to promote tourism, it can lead to development.
Most of the financial resources of local governments come from property taxes and other taxes.
In the current society, where those taxes are not increasing, additional financial resources are needed.
In the example of Kyoto City, overflowing garbage was due to increased tourists and the lack of garbage cans.
In Japan, the issue of overtourism has not been considered much yet, but examples of the problem can be seen in Venice, Italy.
The problem is that too many tourists reduce residents’ quality of life.
This should be addressed and also improve the quality of tourism to tourists in the first place.
Conclusion
The term “new tax” may sound unpleasant to some.
However, tourism-related taxes may go up a little more in the future.
If you understand what the tax is, you will be able to understand the tax.
