The Greek Parliament has recently approved a bill that will impose higher taxes on short-term rentals, hotel stays, and cruise visits. This initiative aims to mitigate the financial burden caused by climate change-induced natural disasters, including floods, wildfires, and droughts.

Tourism remains a vital sector of Greece’s economy, but these new taxes will impact international travelers, including an increasing number of visitors from India.

What are the new taxes?

Beginning in 2025, Greece will introduce higher daily accommodation taxes and new levies for cruise passengers.

• Short-term Rentals: The daily tax during the peak season (April to October) will increase from €1.5 (Rs 134) to €8 (Rs 717), a fivefold rise. In the off-peak months (November to March), the tax will go up from €0.5 (Rs 45) to €2 (Rs 179), a fourfold increase.
• Hotels: Hotel taxes during the summer months will range from €2 to €15 (Rs 179–Rs 1,344) per day, depending on the hotel’s star rating.
• Cruise Ship Passengers: A €20 (Rs 1,790) tax will apply to cruise passengers visiting popular islands like Santorini and Mykonos, while other destinations will have a €5 (Rs 447) levy.

These changes are among the steepest tax increases seen in Greece’s tourism sector in recent years.

Why these taxes?

These higher taxes are a response to the increasing costs of managing the effects of climate change, such as severe weather events that have damaged Greece’s infrastructure. The government expects to raise €400 million annually from these new taxes, nearly doubling the revenue from previous years, according to Reuters.

Impact on Indian Tourists

Indian tourists, often attracted to luxurious stays and unique local experiences, will likely feel the impact of these tax hikes in several ways:

• Increased Accommodation Costs: Budget travelers may need to reconsider their accommodation choices, as short-term rentals and hotels will be subject to higher taxes.
• Higher Cruise Costs: Indian travelers opting for cruises in the Mediterranean may find popular destinations like Santorini and Mykonos less attractive due to the added tax.
• Seasonal Adjustments: Winter visits could become more appealing as accommodation taxes are lower in the off-season, although the weather may not be ideal for activities like island-hopping.
• Rising Tour Package Prices: Travel operators may adjust their prices to account for the higher taxes, potentially increasing the overall cost of travel.

Tips for Indian Travelers

To mitigate the impact of these new taxes, travelers can consider the following:

• Travel Off-Season: Visiting Greece during the winter months can reduce accommodation taxes, though the weather might not be as favorable for island-hopping.
• Explore Less-Taxed Destinations: Instead of visiting tax-heavy areas like Santorini and Mykonos, consider exploring other Greek islands to avoid high cruise levies.
• Budget Ahead: Make sure to factor in the increased daily costs when planning your trip and consider booking accommodations before the tax hikes take effect.

By planning and adjusting your travel strategy, you can still enjoy Greece while managing the financial impact of these changes.