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Japan
This Week in AsiaEconomics

Japan’s Osaka weighs new tax on inbound visitors in bid to make region ‘more attractive and comfortable’

  • Osaka currently imposes an accommodation tax and plans to set up a panel to consider the new levy, which could be introduced in 2025
  • The extra funds could go towards creating new tourist information materials, repairing roads and replacing old-fashioned facilities such as squat toilets

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Boats sail along a river in Osaka, Japan during the Tenjin Festival on July 25, 2023, with fireworks lighting up the night sky. Photo: Kyodo
Julian Ryall
Another popular tourist destination in Japan is planning to introduce a new levy on foreign visitors, with the governor of Osaka prefecture vowing that the funds generated from the tax will be reinvested into the region’s tourism infrastructure.

Industry insiders and analysts broadly agree that an additional small daily levy would not place too much of a burden on travellers or put others off visiting Osaka – but they emphasise that the prefecture must keep its promise to plough those funds back into the tourism sector.

Osaka Governor Hirofumi Yoshimura announced on Wednesday that he would set up a panel to consider the new levy in April and to examine the effectiveness of an existing accommodation tax.

The prefecture currently imposes a levy of 100 yen (68 US cents) per person per at hotels that charge between 7,000 yen and 15,000 yen per night. The levy rises to 200 yen for hotels costing between 15,000 yen and 20,000 yen a night, and up to 300 yen per night for more expensive rooms.

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The existing room tax earned Osaka 1.06 billion yen in 2022 and is expected to bring in a great deal more now that more foreign tourists are returning to Japan’s third-largest city after the pandemic.

While no figures have been decided upon for the proposed levy hike, Yoshimura is bullish about the plan, saying in a press conference, “For us to make Osaka prefecture more comfortable and attractive by implementing various tourism policies, why shouldn’t we ask for a little more?”

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The new levy is likely to be introduced shortly before Osaka hosts the 2025 World Expo.
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