Tourism: a resource to be governed
PRESS RELEASE
TOURISM: A RESOURCE TO BE GOVERNED
Italy is growing economically thanks to tourism. Tourism, particularly from abroad, is booming, with international visitor numbers up 14% compared to 2023, and spending by foreign tourists, in the first two months of this year, up 20% compared to the same period last year. An increase that could contribute up to 15% of Italy’s gross domestic product.
But overtourism, which is the other side of the coin, has become a phenomenon that is now complex and difficult to control. Eurispes has attempted to take stock of the situation through a study coordinated by the Director of our Institute’s Fiscal Policy Observatory.
International tourist arrivals in the world will increase by an average of 43 million per year and will reach 1.8 billion by 2030, 41% of which will be in Europe.
By 2024, 215 million tourist arrivals are estimated in Italy, with total expenditure – between foreigners and Italians – estimated at EUR 62 billion. In August 2024 alone, the arrival of foreigners was around 40 million, with a turnover of over six and a half billion euro.
In Florence alone, short-term rentals have a turnover of about 2 billion, with an annual flow in terms of tourist tax of about 70 million euros. In 2023, Airbnb alone paid into the city’s municipal coffers about one million a month in tax (€14.389 million), equal to about 20% of what was paid by the city’s 393 hotels. In 2022, the platform had paid around EUR 11 million out of a total of EUR 43 million collected.
Ranking the urban destinations most affected by overtourism, based on the number of nights spent in 2023 by domestic and foreign visitors per square kilometre, we find Dubrovnik in first place, followed by Venice and Macao. Rome (in 13th place) is also among the top fifteen, just below Paris (12th).
And yet, the number of properties for tourist rentals, at national level, is less than 2% compared to the total number of empty properties, amounting to 9.5 million, about 27% of the total property stock.
On the economic side, in 2023, Florence, Rome and Naples recorded the highest increase in rates compared to 2019 (over 60%), but it is Venice where the average daily rate is highest (209.63 euro). In the 2023 snapshot, the city with the most available accommodation remains the Capital (22,080), up compared to 2022, but still behind the record year for Italian tourism, where, in 2019, there were more than 30,000 available accommodations (-31%). Finally, in Milan, there was the greatest increase in the offer for short-term rentals in the transition from 2022 to 2023 (+48%).
The first region for available short-term rental accommodation is Tuscany, where there are 108 thousand, one seventh of the national total. The concentration of tourist accommodation then sees Sicily in second place with 90 thousand available solutions, equal to 12% nationally. In third place is Lombardy with 78 thousand units, or 10% nationwide.
As far as turnover generated by short-term rentals is concerned, behind Tuscany, first with 1.3 billion euros, comes Lazio, which, with 8% of available accommodation, generates 14% of the total turnover. In the capital alone, second in the world after Paris in terms of the number of nights booked through the four platforms Airbnb, Booking.com, Tripadvisor and Expedia Group, the number of bookings rose from 8,574 million in 2022 to 11,768 million in 2023. Third in terms of turnover is Lombardy with just under 1 billion in revenue, followed by Campania (740 million), Sicily and Veneto, both at 630 million. The top 9 regions also include Apulia (450 thousand euro), Sardinia (410 thousand euro) and Liguria (377 million). As a whole, the sector recorded 57 million nights booked in 2023 with a turnover of 7.7 billion.
In order to tackle overtourism, the road of penalising tourist rentals tout court may, however, lead little further. Solutions, also in terms of fiscal leverage, must take place within a national framework. And that the matter deserves a different discipline is also demonstrated by the numbers of the sector, where, for example, in Florence alone, short-term rentals have a turnover of about 2 billion, with an annual flow in terms of tourist tax of about 70 million euro. Multiply these numbers by all the Italian realities and we could cover more than one financial year.
Finally, another fundamental aspect of the sector should be pointed out: most Italian hotels are affiliated to foreign companies, which dominate the market.
In 2023, the hotel sector alone generated EUR 30.5 billion in revenue, of which EUR 18.3 billion related to foreign affiliated structures, with fees paid to the franchisor amounting to at least EUR 2.7 billion (15% of turnover), taxed mainly abroad. The lost tax revenue can thus be estimated to be at least EUR 1 billion per year. Similarly, bookings through Online Travel Agencies (almost all of them foreign) generate fees that further reduce tax revenues in Italy by about another billion euros per year. Thus, the cost of our tourism-hotel sector’s set-up for the country system can be estimated at a loss of about 2 billion euros per year in revenue for the national treasury (without considering the billions of euros not paid by the large telematic platforms based abroad).
Yet, there would be no particular constraints preventing the development of a national tourism operator of international significance. And this, even considering that Italy is in fifth place in the ranking of arrivals from abroad.
The issue, therefore, is that tourism, at least compared to its potential, still leaves little (and maldistributed) wealth in Italy, but guarantees 100% of the negative externalities borne by all citizens.
Basically, we must limit the level of private appropriation of benefits and strengthen the spillover in terms of redistribution of resources to all the inhabitants of tourist destinations. The degeneration of tourism must be stopped, not tourism.
Twenty operational proposals to return to governing tourism
1) National regulation of short-term rentals with overcoming regional differences
2) Regulation of businesses in historic centres by also directing them towards the needs of residents
3) Heavier penalties for tourists who break rules on alcohol, noise and decorum
4) Flow management, also through big data and artificial intelligence
5) Strategic urban planning
6) Building incentives for young people
7) Unused public buildings to be made available for long-term rent at affordable prices
8) Governance, monitoring and flow control model shared between regions and state
9) Community involvement in tourism management decisions
10) More effective and faster legal protections against defaulting tenants
11) Increase in the tourist tax and its allocation for targeted actions (public green spaces, street furniture, public transport, recovery of public real estate, etc.)
12) Fiscal incentives, such as dry coupon at 10%, for long-term rentals
13) Eco-tax for air tickets
14) Expansion and streamlining of rail networks and infrastructure
15) De-seasonalisation, also through a specific holiday bonus
16) Decentralisation and redistribution of attractions, including museums
17) Enhancement of new territories and destinations
18) Promotion of sustainable tourism, also through the establishment of a tax for sustainable tourism
19) Strengthening digitalisation in tourism
20) Training of human capital engaged in tourism