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US travel tax angering EU, which could react with similar policy

In German news magazine Der Spiegel, European Union officials are responding negatively to a travel fee ESTA that the US is imposing on residents of countries that are currently not required to obtain visas to visit the US, “36 countries worldwide including every EU country except for Bulgaria, Cyprus, Poland and Romania.” Although the $14 fee is small, $10 of it goes to promoting tourism in the US. While the US economy is certainly not at its strongest point, it is the #2 travel destination in visitors (France is #1) and already pulls in the most revenue. This fee, combined with notorious US customs and immigration officials, make for a very unwelcoming and unattractive image of America abroad as a travel destination. This is undermining our global image and respect. I certainly hope this policy is repealed and that the EU does not retaliate with similar measures.

Excerpts below.

European Union Up in Arms over US Travel Tax

“European Union officials are furious with a new US fee mandatory for most travelers from Europe. Calling the charge tantamount to a new visa requirement, the EU is now considering introducing a similar fee for American travelers. Fourteen dollars may not sound like a lot. But this autumn, the sum — in the shape of the new fee being charged by the United States to some overseas visitors coming into the country — is proving enough to inflame tempers in the European Union. This month, an increasing number of members of the European Parliament and other EU officials are blasting the charge for being both incongruous and for running counter to US-EU agreements.

“I think it is a bit bizarre to introduce a tax to promote tourism,” intoned Alexander Graf Lambsdorff, a member of European Parliament with Germany’s business-friendly Free Democratic Party during a recent debate on the issue in Strasbourg. In addition to pointing out that such a tax could actually dissuade people from traveling to the US, Lambsdorff also said “it seems a bit absurd that the US of all countries would tax people who are not represented in this debate. Taxation without representation, I believe, has played a certain role in American history.”

At issue is the so-called Electronic System for Travel Authorization (ESTA), a $14 fee which travelers from 36 countries now have to pay prior to visiting the US. While $4 dollars of the fee is to be for ESTA administrative costs, $10 is to pay for US efforts to promote the US as a tourism destination. Travelers to the US, in effect, are being asked to pay for the advertising aimed at encouraging them to travel to the country…Now, the EU is exploring the possibility of introducing a similar system for travellers from the US, according to the European Commission for Home Affairs. A “policy study” is currently being undertaken to investigate the feasibility of such a fee…

…The US fee applies only to travelers from countries not currently required to obtain a visa prior to travel — a list comprising 36 countries worldwide including every EU country except for Bulgaria, Cyprus, Poland and Romania. In a parliamentary debate last week, several members of the European Parliament (MEPs) complained that the fee was simply a different kind of visa, particularly given that those travelers who do not pay the fee can be refused entry into the US…

…The fee, part of a tourism promotion package pushed through primarily by Senate Majority Leader Harry Reid, has been controversial in the travel industry as well. “It’s like inviting a friend over for dinner and then charging them a fee at the door,” Steve Lott, a representative for the International Air Transport Association, told CNN earlier this month. “If the idea is to make the United States more welcoming and to increase tourism, raising the entry fee seems to be counterintuitive to what you’re trying to do.”

European Commission officials have promised to take up the issue in upcoming meetings with their US counterparts. Speaking on behalf of EU foreign policy representative Catherine Ashton, EU State Secretary for European Affairs Olivier Chastel insisted that “the EU places great importance on the issue of reciprocity” when it comes to trans-Atlantic travel. He said his office “will pull out all the stops to work with the Commission to establish the principle of reciprocity on travel…”

  1. September 28th, 2010 at 09:50 | #1

    I am just wondering how much in taxes do tourist pay as entrance fees, at tourists centres/ attractions, because if they are not paying anything for tourism development at teh centres then I do think that US is right , however if they are paying something then the US government is not fair. In my country Uganda, tourist pay taxes for tourims development on everything despite the fact that they pay visa fees and the fees goes back to tourism development. http://www.ugandasafariguide.com

    • September 28th, 2010 at 10:00 | #2

      Thanks for writing. Most US tourist attractions cost money, but it depends where you are. For example, the group of museums known as the Smithsonian in Washington DC have free entrance. But that’s not the case in many cities. This ESTA rate is of course not that expensive for most people, but it’s a question of principal that people have to pay to visit, and for those getting visas, US entry is quite expensive http://travel.state.gov/visa/temp/types/types_1263.html

  1. October 5th, 2010 at 20:58 | #1

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