Euro 2024: 6 million Euros missed in Munich?
Big sporting events, such as the current European Championships Football in Germany and the upcoming Olympics in Paris, are viewed as excellent means to boost tourism to the destination. So announced Airbnb last week that bookings for the Olympics time window are up 400% (!!) compared to last year.
From a policy perspective the development of tourism is typically measured on metrics as the increase in spending on hotels, restaurants, shopping, and day trips. Development of tourism is largely a long-term goal, with a steady increase in numbers being one of the objectives. But what if we look at the immediate monetary effects, such as collected tourist tax?
๐๐๐ฟ๐ฟ๐ฒ๐ป๐ ๐๐ผ๐๐ฟ๐ถ๐๐ ๐๐ฎ๐ ๐ถ๐ป๐ฐ๐ผ๐บ๐ฒ ๐ถ๐ป ๐ ๐๐ป๐ถ๐ฐ๐ต
Looking at Munich during Euro 2024, these results are easily calculated: โฌ0.00
Munich, unlike other prominent German cities such as Hamburg and Berlin, does not levy a tourist tax. By not doing so, there is a lot of missed potential income, that could have been invested in for instance the cityโs infrastructure, which benefits everyone. What amount could have been collected? Letโs look at the numbers. If we follow the same structure as Berlin, the total collected tax is determined by three factors: the number of overnight stays, the price per night, and the tax rate.
- ๐ก๐๐บ๐ฏ๐ฒ๐ฟ ๐ผ๐ณ ๐ผ๐๐ฒ๐ฟ๐ป๐ถ๐ด๐ต๐ ๐ต๐ผ๐๐ฒ๐น ๐๐๐ฎ๐๐: During Euro 2024, we assume ~600.000 nights (75% average occupancy on day prior to, match day, day after, 44.000 rooms. 6 match days)
- ๐ฃ๐ฟ๐ถ๐ฐ๐ฒ ๐ฝ๐ฒ๐ฟ ๐ป๐ถ๐ด๐ต๐: โฌ200 per night
- ๐ง๐ฎ๐ ๐ฅ๐ฎ๐๐ฒ: 5% (as in Berlin)
- ๐ง๐ผ๐๐ฎ๐น ๐ฝ๐ผ๐๐ฒ๐ป๐๐ถ๐ฎ๐น ๐๐ฎ๐ ๐ถ๐ป๐ฐ๐ผ๐บ๐ฒ: (600k200)5% = โฌ5,94 million
In this example, we only considered hotel stays. If other types of lodging were uses, such as citizens renting out their homes on Airbnb, the number would be even higher.
With the Olympics coming up, next month we will have a look how Paris handles this (totally different).
