Cities and communities are allowed to charge hotels and their overnight guests a bed tax. On Tuesday, the Federal Constitutional Court dismissed several lawsuits from hotel operators in Hamburg, Bremen and Freiburg as unfounded and thus finally declared the levy to be compatible with the Basic Law. (Az. 1 BvR 2868/15 and others)
For years, more and more cities and municipalities have been levying the bed tax. So far, it only applies to private overnight stays in hotels or guesthouses. Sometimes the tax also appears on the invoice as a city tax, culture tax or lodging tax.
The amount is then often three euros per night or five percent of the overnight price. In Hamburg, the amount is graded according to the overnight price.
With the decision from Karlsruhe, the tax is now legitimized, and other cities are likely to come up with the idea of levying it. According to the bettensteuer.de portal, there are currently 43 cities and municipalities, with another 13 planning to introduce it. Some municipalities had already introduced the tax, but it was repealed or suspended by the courts.
After the decision of the First Senate, there is now a new basis. And in the future, according to Karlsruhe, cities will even be able to levy a bed tax on overnight stays at work. This would make it possible to extend the tax to hotel accommodation. So far, business travelers were exempt after a ruling by the Federal Administrative Court in 2012.
“The accommodation tax is a local expenditure tax within the meaning of Article 105 (2a) sentence 1 of the Basic Law, which is not equivalent to federal taxes,” the judges stated. In this respect, the tax is not in competition with other taxes and is in order from a legal point of view. The legislative power of the federal states is “not blocked by a similar federal tax”.
However, many hotel operators are unlikely to agree with another argument of the judges: the bed taxes “do not put an excessive burden on the accommodation establishments concerned,” the reasoning says.
The German Hotel and Restaurant Association (Dehoga) and the Hotel Association Germany (IHA) see things very differently. “We are extremely disappointed with this decision,” it said in a joint statement. “Unfortunately, no limits were placed on the municipal tax determination law. After the massive slump in sales caused by the corona pandemic, it means another severe blow for the industry,” said the associations.
Compared to the pre-pandemic period, the drop in sales at the beginning of this year was 40 percent. “We appeal to the municipalities not to take this decision as an encouragement to introduce bed taxes now and to confront hoteliers and guests with new burdens.”
The tax is particularly difficult for small and medium-sized hotels: they often pay the tax themselves so as not to have to burden their guests with it. The association also criticizes the bureaucratic effort.
The ADAC motorists’ club also rejects bed taxes. Unlike the visitor’s tax and the tourist tax, there is no guarantee that the money will benefit local tourism: “It is not transparent what the bed tax is used for.” is really on business and who is private.
The constitutional judges consider it justified for hotels and guesthouses to collect and pay the tax on behalf of the Treasury. “A direct survey of overnight guests would not be practicable,” said the judges in Karlsruhe.
The background to the bed or accommodation tax is the reduction in value added tax for hotel accommodation from 19 to seven percent in 2010. At that time, the FDP in particular had campaigned for the reduction.
When it later became known that the party had received a million-dollar donation from hotel entrepreneur August von Finck, it was temporarily given the nickname “Mövenpick Party” in reference to Finck’s participation in the hotel brand. The term “Mövenpick tax” was also widely used.
However, the loss of income was also a problem for many cities and municipalities due to growing old debts. In the same year, 2010, the city of Cologne was the first to come up with the idea of collecting a fee from overnight guests.
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