Vienna postpones local tax increase: tourism industry breathes a sigh of relief!

Vienna postpones local tax increase: tourism industry breathes a sigh of relief!

Today, a significant change has taken place in Vienna's tourism industry. Originally, the local tax was supposed to rise from 3.2% to 8.5% from December 1, 2023. But due to pressure from the industry, this project has now been postponed. MyDistrict.at reports that the city of Vienna is instead planning a gradual increase: from July 1, 2026, the local tax will be increased to 5% and from July 1, 2027 to 8%.

Criticism of the original increase came in particular from Walter Ruck, President of the Vienna Chamber of Commerce, and Walter Veit, Chairman of the Austrian Hotel Association. Ruck emphasized that the existing taxation is already sufficient to support “Vienna Tourism”. Veit, on the other hand, expressed concerns that such an increase could scare away potential guests and bring additional legal challenges for the businesses. The discussions between the city and industry representatives ultimately led to a positive agreement, which was praised by Dominic Schmid (WKW) and Alexander Ipp (ÖHV).

A solution with vision

During the discussions it became clear that it was not just about financial aspects. The city also plans to simplify and reduce bureaucracy in the processes for charging local taxes. An important point is the modernization and digitalization of the systems in the hotels so that processing runs more smoothly in the future. Neos state parliament member Markus Ornig described the agreement as an important step towards consolidating Vienna's tax system.

For the residents and tourism professionals in Vienna, this not only means relief, but also a common perspective. The Vienna Tourism Association, which is responsible for promoting tourism and representing the interests of the State of Vienna, sees itself as having a responsibility to overcome such challenges. The association is financed not only through the local tax, but also includes its own income, subsidies and donations, as shown on the WKO website can be read.

Who pays and who collects?

The local tax affects all guests who stay in accommodation in Vienna for a fee, be they holidaymakers, business travelers or others. Regardless of whether the fee is paid by the guest themselves or by a third party, the payment obligation exists. However, exemptions apply to certain groups, such as minors in school or vocational training or students at Viennese universities.

The responsibility for collecting the local tax lies with the owners of accommodation. They must submit the tax to the magistrate by the 15th of the following month. They are also required to submit an annual tax return by February 15th for the tax debt incurred in the previous year. Supporting aids for the calculation include a leaflet from the Vienna Hotel Industry Group and a local tax calculator from the City of Vienna.

The changes to local tax are being welcomed by many in the industry as a sensible solution. This not only strengthens Vienna's attractiveness for tourists, but also promotes sustainable growth in the undisputedly important tourism sector.