Japanese local governments are looking for stable financial resources for a long-term tourism plan. To give hints, Japan Travel Bureau Foundation (JTBF) organized ‘Tourism Resources Seminar’ particularly focusing on accommodation tax, joined by 18 public organizations.
Clear rules and a tourism plan to avoid expanding uses
According to the Local Tax Law, the introduction of a non-statutory accommodation tax requires the establishment of a ‘collection rules.’ Masahiro Kanno, JTBF Senior Chief Researcher, said, “ ‘For tourism' is a broad term, and there is a risk that it could be used for anything through an overly broad interpretation. It is necessary to clearly the use of the funds in advance because the decided framework continues even if the mayor or administrative personnel in charge at the time of introduction change,”
“In addition to ‘collection rules,’ ‘use rules’ that specifies who should use it and how should be required,” he said. “When introducing a lodging tax, it is necessary to link the funds and tourism plans.”
It is recommended that the obtained funds be converted into a fund so that they can be used long-term over multiple years, and that voluntary monitoring be carried out to check whether the funds are being used correctly. Kanno added, “Planning and monitoring should be done by a public-private collaboration system involving the government, businesses, and citizens.”
JTBF上席主任研究員の菅野正洋氏
Why can Kuchan increase tax revenue?
Kutchan in Hokkaido, a town of famous ski resort ‘NIseko,’ has introduced the accommodation tax with the fixed rate of 2% since November 2019. According to Norihiko Suzuki, head of Kutchan Tourism Association,, in 2019, the first year, tax revenue of approximately 180 million yen was obtained. In 2020, due to the COVID-19 pandemic, it fell sharply to about 50 million yen, and in 2021 to about 60 million yen, but in 2022, when there was a recovery from the pandemic, it rose to about 240 million yen, significantly exceeding the pre-COVID level, and in 2023 it has increased to about 440 million yen, nearly double the previous year.
Suzuki said of the reason for introducing the flat rate system as being, “Many of accommodations in Kuchan set prices per room rather than per number of people, making it difficult to capture revenue by number of people.” Also, he explained that rise in unit prices through improvement of revenue management allowed to increase tax revenue.
In Kutchan, the accommodation tax is used to accumulate in a fund that can be used for long-term tourism promotion, as well as for increasing labor costs and hiring new employees.
倶知安観光協会事務局長の鈴木紀彦氏
Agreement of local accommodation is important
Yuichi Yamada, JTBF Director, said that the key to the success of introducing the accommodation tax is whether or not the agreement of local accommodation businesses can be obtained. “It is important to share the dream of how they develop the region, using new tourism revenue,” he added.
In addition, he emphasized that the fixed rate system is easier to increase tax revenue than the flat rate system because to raise unit price is easier than to increase the number of guests.
JTBF理事の山田雄一氏
