Santiago would earn 2,625,000 Euros per year under a proposed tourist tax. The plan centers on implementing a tax based on accommodation and is reflected in 2022 overnight stay data. A report prepared for the University of Santiago USC argues that establishing a regional tourism tax tied to lodging facilities would be appropriate. To enable municipalities to impose such a tax, the Galician Parliament would need to empower local councils, and Raxoi is expected to present its proposal in San Caetano in the near future.
Tourism is a major economic, social, and cultural force with a wide impact. In Santiago this activity contributes to overcrowding and raises the costs of some services. The financial instrument is seen as particularly useful in addressing these issues, according to the plan the City Council is developing. The document specifies that the tax event should be defined by the law and charged to operators of tourist accommodations, regardless of whether visitors stay overnight or for shorter periods.
Regarding the tax amount, the proposal would apply to tourist apartments as well as traditional lodging and ranges from a minimum of 0.5 euros to a maximum of 2.5 euros per day, with a six day cap. The minimum levy would apply to travelers staying in hostels, inns, and standard tourist apartments, houses for tourist use, rural hotels, and similar accommodations. Camping sites and overnight areas used by caravans or private farmhouses with registered tourist facilities would also be taxed.
The rate would be one euro for accommodation in 1, 2, and 3 star hotels, plus higher rates for superior tourist complexes, premium tourist apartments, and certain rural hotels. The plan also sets a rate of 1.5 euros per day or per stay for superior tourist blocks and complexes.
A rate of 2 euros per day would apply to fractional accommodations or 4 star and higher category hotels, aparthotels, spa hotels, and thalassotherapy facilities. The maximum rate would be 2.5 euros per day for top tier hotels, luxury campsites, and five star apartment hotels.
The City Council’s proposal emphasizes including home accommodations used for tourism in the scope of the tax if they meet the criteria, arguing there is no sound reason to exclude them. The plan suggests applying the tax only in municipalities with high or seasonal tourism impact, with at least 95 percent of collected funds directed to the local governments enforcing the tax. A portion of the revenue would be returned to these municipalities as unconditional financing.
The report also notes a charge for those arriving by bus to the Xoán XXIII promenade near the Cathedral. The administration would assign this responsibility to the municipal company that runs the nearby car park and would collect fees through the bus operators serving visitors to the city.
On total potential income, the plan concedes difficulty but uses 1.75 as a starting point and references 1,500,000 overnight stays in 2022 with an average nightly rate. It concludes that income for Santiago could reach 2,625,000 Euros. The document also asserts that the tax would not reduce tourism demand elasticity in Compostela and would generate substantial revenue, drawing on examples from other autonomous communities where similar taxes exist. In Catalonia, pre pandemic years showed strong collections and seasonal variability, with 39,970,000 euros in 2017, 38,540,000 in 2018, and 42,580,000 in 2019. These figures are used to support the case for a tax with the described features, as approved by the Galician Parliament.
Exemptions in cases that do not involve tourist stays: health, business, and more
The plan also excludes visits to sporting events or academic activities from taxation
The USC proposal for the Santiago City Council provides exemptions in cases that do not involve tourist accommodation. For example, accommodations arranged for health reasons or the accompanying persons would be exempt. Activities such as conferences and evaluation panels conducted by public and university entities, academic stays, official sports competitions, or work related stays would also be exempt.
Other exemptions include stays by individuals aged eighteen or younger, excursions or school trips for students below university level, subsidized stays under public EU member state social programs, and stays for persons with a disability at or above 66 percent.