Anger from hotel industry at go-ahead for Paris to triple tourist tax

Professionals in the Ile-de-France hotel industry have reacted angrily to news that France’s tourist tax will increase by up to 200% over the current amount in 2024.

The government’s projet de loi de finances, which it is currently moving through parliament, states that Paris’ taxe de séjour is set to rise next year. The extra funds are planned to go towards improving public transport provision, run by Ile-de-France Mobilités (IDFM), as the capital hosts the 2024 Olympic and Paralympic Games.

The taxe de séjour starts at €0.25 per night for a simple campsite, and increases depending on the accommodation, to a current maximum of €5 per guest per night for the plushest hotels.

In practice, any accommodation of a standard lower than a four-star hotel is likely to have tax of less than €1 per night, per person. The average tax for five-star hotels in 2021 was €1.69 per night, per person. Only very exclusive, luxury accommodation, known as palaces in French, charge more.

The local department can also apply an additional 10% to the tourist tax, for the funding of local tourist infrastructure and services.

Read more: Explainer: What is France’s taxe de séjour, who pays it and when?

However, industry critics say that the decision to increase the tax for IDFM was taken without appropriate consultation with the sector, and will make Paris the most-taxed capital in Europe - ahead of Rome, Brussels, Berlin, Athens, Madrid, and London.

In a statement published on September 29, the Union des métiers et des industries de l'hôtellerie (UMIH) said: “With a 200% addition to tourist tax planned for 2024, Paris and the Ile-de-France region have already won the gold medal for taxation [even before the Games begin].”

The statement was issued in partnership with the Groupement national des chaînes hôtelières (GNC).

The complaint refers to the agreement - reached between IDFM president Valérie Pécresse and Transport Minister Clément Beaune - for “the creation on January 1, 2024, of an additional tourist tax…collected in the Ile-de-France region and allocated to Ile-de-France Mobilités”.

The agreement states that the increase will have “a ceiling rate of 200%”. In practice, this means that up to 200% of the current tax rate could be added to the existing amount. This means that in some cases, the total tax bill will triple.

For example, a top five-star ‘palace’ hotel in Paris that currently charges the maximum €5 per night in taxe de séjour could be required to add €10 (200%) extra to this, making the final fee €15 per night.

The UMIH and GNC claim that this measure “will have a lasting negative impact on the competitiveness of the destination in terms of business and leisure tourism in France's leading tourist region”.

Véronique Siegel, president of UMIH hôtellerie française, called it “a tax bludgeoning”, and said that it would have “a lasting impact on the competitiveness of our businesses”.

The groups suggested that instead of increasing the tourist tax, the government could finance extra public transport “by taxing vacant homes and offices” instead.

The Groupement des hôtelleries et restaurations de France (GHR) group has also criticised the plan, and said that hospitality businesses will suffer increased labour costs as a result of the tax rise.

In a joint statement, Didier Chenet and Pascal Mousset - GHR national president and Ile-de-France president respectively - said: “The increase will further raise labour costs, even though hotels, cafés and restaurants already spend more than 40% of their turnover on wages and salaries.”

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Explainer: What is France’s taxe de séjour, who pays it and when?