By Hirofumi Morita / Yomiuri Shimbun Staff Writer

The Tokyo metropolitan government has compiled a draft proposal to revise its accommodation tax system levied against hotel guests, switching from a flat-rate system to one that is fixed-rate and charges 3% of accommodation fee, according to sources.

The new system will also cover private lodging and common lodging houses. The accommodation tax exemption threshold will be raised from the current under 10,000 yen per person per night to under 13,000 yen per person per night.

The metropolitan government will solicit opinions from the public on the draft proposal from Thursday to Dec. 26. It plans to submit a bill to revise an ordinance on accommodation tax to the Tokyo Metropolitan Assembly, which is scheduled to be held in February. After obtaining approval from the internal affairs and communications minister, it hopes to enforce the ordinance within fiscal 2027, which ends in March 2028.

Tax revenue is expected to increase to 19 billion yen annually. The government anticipates 6.9 billion yen to be generated this fiscal year.

Since October 2002, Tokyo has imposed a tax of 100 yen per person per night for stays between 10,000 to 14,999 yen, with 200 yen for stays incurring higher totals. The tax revenue has been allocated to tourism-related measures. However, due to factors such as the surge in inbound tourism, administrative costs have been rising. Consequently, 30.6 billion yen has been allocated for tourism-related measures in the initial budget for the fiscal year ending March 2026.

By shifting to a fixed-rate system, the metropolitan government aims to narrow the gap between accommodation tax revenue and expenditures for tourism policies. A fixed-rate system is linked more closely to economic trends and inflation, and allows taxes to be levied according to the high accommodation fees charged by foreign-owned luxury hotels and others. On the other hand, the measure will increase the burden on hotel operators, who collect the tax from guests.

In Japan, the town government of Kutchan, Hokkaido, introduced a fixed-rate accommodation tax of 2% in November 2019. The Okinawa prefectural government aims to introduce a fixed-rate accommodation tax in the fiscal year ending March 2027.

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This article is from The Yomiuri Shimbun. Neither Dow Jones Newswires, MarketWatch, Barron's nor The Wall Street Journal were involved in the creation of this content.

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November 26, 2025 20:29 ET (01:29 GMT)

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