Photo/Illutration Izu Mayor Yutaka Kikuchi explains the purpose of the “tourism tax” under consideration at the city government building in Izu, Shizuoka Prefecture, on Feb. 20. (Shinya Minamishima)

IZU, Shizuoka Prefecture--To promote tourism, the seaside resort town of Izu here is considering introducing a "tourism tax" that will be collected not only from overnight guests but also from day visitors.

“It is desirable to introduce a targeted tax to support urban development through tourism,” Mayor Yutaka Kikuchi said at a news conference on Feb. 20. 

Izu's proposal is a rare initiative amid a growing trend to impose taxes on tourists to secure funding for tourism promotion across the country.

The city will develop the system in detail and consult with stakeholders, aiming to launch the tax in fiscal 2028.

At the news conference, Kikuchi explained that instead of raising the city's existing bathing tax, he plans to introduce a new tourism tax.

Currently, around 50 million yen ($334,000) out of the 110 million yen collected from the bathing tax, which is primarily intended for the maintenance of hot spring facilities, is being redirected to promote tourism.

“It’s better to properly explain the purpose of the tax to the tourists who are being taxed,” Kikuchi said.

He added that the responsible department has been considering the tourism tax since fiscal 2024.

The city plans to introduce tiered tax rates for accommodations due to the varying price ranges among facilities.

It is considering a fixed rate for day visitors, with the tax being possibly collected at large tourist facilities and parking areas within tourist zones.

“We didn’t want to limit the necessary expenses across the entire Izu area for ensuring a comfortable stay for tourists to an accommodation tax imposed only on these facilities,” Kikuchi said.

The city will specify the use of the tourism tax in the Basic Scheme of Tourism Promotion to be formulated in fiscal 2025 and will move forward explanations to stakeholders, the enactment of an ordinance and discussions with the internal affairs ministry and other relevant parties in fiscal 2026 and 2027.

According to the city’s Tourism and Commerce Department, around 760,000 people stayed overnight in the city in fiscal 2023, while the total number of tourists was around 3.5 million.

Common examples of taxes imposed on visitors to tourist destinations include the bathing tax and accommodation tax.

For day visitors, Hatsukaichi, Hiroshima Prefecture, imposes the Miyajima Visitor Tax, while four villages in Okinawa Prefecture levy an entry tax.

However, unlike an island, Izu cannot easily track all incoming visitors, making it challenging to ensure a fair taxation system.

In eastern Shizuoka Prefecture, Atami city is set to introduce an accommodation tax in April, while Higashi-Izu town and Ito city will raise their bathing taxes in March and October, respectively.

Oyama Town Mayor Masahide Komiyama said at a news conference on Feb. 18, “We plan to establish a Destination Management Organization (DMO) and consider implementing an accommodation tax as a funding source.”

According to the town’s Commerce and Tourism Division, an estimated 180,000 people will stay overnight in fiscal 2024, with inbound tourists accounting for 76 percent of these visitors.

“We need to create experiential facilities and other attractions,” Komiyama said, with the long-term stay resort hotels in mind.

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