Prague 1 aims to significantly increase the city's tourist tax

The Prague 1 City Council has initiated talks with Prague’s municipal authorities and other bodies to raise the local accommodation tax, which is currently set at CZK 50 per person per night. This rate, according to the council, has become insufficient when compared to other European cities and no longer reflects the financial demands of tourism in the district.

Data provided by the financial committee in collaboration with the city-owned company Prague City Tourism show that the average tourist tax in EU cities is around 7 EUR (around CZK 175) per night, more than three times the current rate in Prague.

Raising the tax, officials argue, would not only bring Prague closer to European standards but also improve the management of this revenue stream, which is a crucial source of income for the district.

"This tax helps to compensate for the costs associated with tourism. Tourists generate waste, use public transport, and put a strain on local infrastructure, which affects the municipal budget," Giancarlo Lamberti, chairman of the Prague 1 financial committee, explains through a press release.

"Raising the tax would make Prague and the district wealthier without impacting local residents. The extra funds could significantly improve public services, such as street cleaning and maintenance."

In addition to increasing the maximum rate, Prague 1 is also exploring the possibility of diversifying the tax across different city districts, allowing each area to set its own rate up to the national limit. This would enable more tailored solutions for local conditions.

"The accommodation tax forms an important part of our budget, and with increasing pressure on various expenditure items, we need to explore ways to strengthen our revenue," adds Prague 1 Deputy Mayor Tomáš Heres, noting that the current tax rate is outdated compared to neighboring cities in Europe.

"Our goal is to maintain a high standard of services for our residents while ensuring adequate investment in Prague 1."

Officials hope that increasing the tax will help better regulate tourism in the city center, and ensure that Prague 1 doesn't just remain a tourist hotspot but a quality place to live for long-term residents.

The city center has seen its population slowly decline over the past two decades, with additional challenges posed by rental platforms such as Airbnb. A new regulation, expected to take effect next year, would allow the city to more strictly regulate online booking platforms.

"Raising the tax is the right step to help us manage the burden tourism places on the city, especially as Prague’s center deals with large numbers of visitors," notes Mayor Terezie Radoměřská. "It is essential that tourists contribute fairly to funding public services."

Proposals regarding increasing Prague's tourist tax will be negotiated by the Prague 1 City Council and are expected to be finalized by March 2025.