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Japan Experiences Record-Breaking Tourism, Considers Tax Hikes to Manage Growth

Japan has welcomed a record number of tourists this year, with nearly 33.4 million visitors between January and November. This surge in tourism has prompted discussions about managing the influx, including potential increases in taxes on hot spring bathing and lodging.

A significant portion of these visitors, approximately 3 million in November alone, including 247,500 Americans, are drawn to Japan's natural beauty and cultural experiences. Reports indicate that over 60% of travelers in 2023 focused on nature and sightseeing, with hot springs (onsens) being a particularly popular attraction. While 28% of tourists have already indulged in the onsen experience, almost half express a desire to do so on future visits.

japan tourist

Nearly 250,000 Americans visited Japan in November. (iStock)

Kenroku-en gardens in Japan

Over 33 million tourists visited Japan from January to November. (Eric Lafforgue/Art In All Of Us/Corbis/Getty Images)

However, this popularity comes at a cost. Overcrowding at popular destinations is a growing concern, with 30% of visitors reporting such experiences. To address this issue and manage the impact of overtourism, several municipalities are exploring options like raising the existing bathing tax, currently around 150 yen ($0.98), or introducing new lodging taxes. For instance, the town of Higashi-Izu plans to double its bathing tax to 300 yen ($2) by March. In Hokkaido, three municipalities have already implemented lodging taxes in addition to bathing taxes, and 16 more are considering similar measures.

Hot springs in Japan

Raising taxes on bathing and lodging are being considered as a measure to manage overtourism. (iStock)

These potential tax increases reflect the balancing act Japan faces between welcoming tourists and preserving the quality of its attractions and the experience of both visitors and residents.