Cologne was the pioneer, and many have copied it: dozens of cities require travelers to pay an extra fee on overnight stays. This is a thorn in the side of hoteliers. Is the bed tax unconstitutional?
City tax, culture tax, lodging tax – the name is different everywhere, the basic principle is the same: In a number of German cities, travelers are asked to pay extra for overnight stays.
Hoteliers from Hamburg, Bremen and Freiburg want to overturn the bed taxes with complaints to the Federal Constitutional Court. The Karlsruhe judges will publish their decision on Tuesday (9.30 a.m.). (Az. 1 BvR 2868/15 and others)
Why are cities suddenly charging a bed tax?
This has to do with relieving hotels of VAT. Since 2010, only 7 instead of 19 percent have been due – at that time one of several controversial tax cuts for the big economic boost, which tore billions of holes in public budgets. It didn’t take long for city treasurers to identify a new source of income in the face of empty coffers. In 2010, the city of Cologne was the first to come up with the idea of collecting a fee from overnight guests. Since then, a number of cities have adopted the model.
How common are bed taxes?
The German Hotel and Restaurant Association (Dehoga) last counted at the beginning of 2019 – at that time 30 municipalities levied a bed tax, including Berlin, Flensburg, Schwerin, Münster, Erfurt and Dresden. In many other places there have been trials that have ended in court. According to the Dehoga information from three years ago, the levies in about 60 cities and communities were “repealed, suspended, politically rejected or abolished”.
How does the bed tax work?
The tax is charged in addition to the actual overnight price. Many municipalities charge around five percent per day of stay. Sometimes a fixed amount has to be paid, for example three euros per night. In Hamburg, the amount is graded according to the overnight price. There is often an exception for children. Since a ruling by the Federal Administrative Court in 2012, “work-related” overnight stays may no longer be taxed. The tax mainly affects tourists and people who are traveling privately. The accommodation is responsible for collection.
Why are the hotels fighting back?
The industry sees itself disadvantaged on one side. Dehoga points out that many others would benefit from tourism, such as retail. “An isolated burden on the hotel industry cannot therefore be justified in terms of content.” The tax is particularly difficult for small and medium-sized hotels: they often pay the tax themselves so as not to have to burden their guests with it. The association also criticizes the bureaucratic effort.
What criticism is there?
The ADAC motorists’ club also rejects bed taxes. Unlike the visitor’s tax and the tourist tax, there is no guarantee that the money will benefit local tourism: “It is not transparent what the bed tax is used for.” The taxpayers’ association complains that in practice it is often not properly checked who is really on business and who is private.
How are the bed taxes to be assessed legally?
The Federal Fiscal Court considers the Hamburg culture and tourism tax and the city tax in Bremen and Bremerhaven to be constitutional. In particular, the levies are not comparable to sales tax, according to two judgments from 2015. This is a key point, because according to the Basic Law, the federal states may only collect local expenditure taxes “as long as and insofar as they are not of the same type as federally regulated taxes”. The Freiburg accommodation tax was approved by the administrative courts. The constitutional complaints are now directed against these judgments.
