Netherlands to Implement Significant VAT Hike on Accommodation Services in 2026

Major VAT Increase for Dutch Tourism Sector

The Dutch government is set to significantly increase the Value Added Tax (VAT) rate for accommodation services, raising it from the current 9% to 21%, effective January 1, 2026. This substantial hike is part of the broader 2026 Tax Plan package and aims to bolster state revenues. The measure has received approval from the Dutch House of Representatives and is currently awaiting Senate endorsement.

Scope and Rationale of the Tax Change

The new 21% VAT rate will apply to a wide array of short-stay accommodation options across the Netherlands. This includes hotels, guesthouses, holiday parks, bed and breakfasts (B&Bs), hostels, and accommodation rented through online platforms. Notably, camping accommodation will retain the reduced 9% VAT rate. The government's primary objective behind this increase is to enhance tax revenues, address budget deficits, and strengthen public finances.

A transitional rule specifies that the 21% VAT rate will apply even to advance payments and bookings made before January 1, 2026, if the actual stay occurs in 2026. This contrasts with a decision to reverse an earlier plan to raise the VAT rate for culture, media, and sports, which will remain at 9%.

Industry Concerns and Economic Impact

The impending VAT increase has drawn considerable criticism and concern from various stakeholders within the Dutch tourism and hospitality sectors. Industry leaders and economists, including representatives from ABN AMRO, Koninklijke Horeca Nederland (KHN), and the HISWA-RECRON water sports and leisure association, have voiced strong opposition, warning of severe negative consequences.

Concerns include:

• Reduced Visitor Numbers: Analysts predict a potential decline in foreign tourists, particularly from neighboring countries like Germany and Belgium, where accommodation VAT rates are significantly lower (e.g., Belgium's 6%). ABN AMRO forecasts a 6.75% drop in overnight stays, while some tourism associations estimate losses of up to one-third of foreign visitors.
• Economic Losses: The HISWA-RECRON association estimates potential losses across the industry could reach approximately 826 million euros if foreign visitors are deterred. ABN AMRO's analysis suggests that the government's projected revenue gain of €1.2 billion annually might be significantly overestimated, with actual additional revenue from hotels potentially reaching only €285 million.
• Job Losses: The Koninklijke Horeca Nederland highlights that nearly 800,000 jobs in the Netherlands are directly linked to tourism, and a downturn could lead to substantial job losses.
• Competitiveness: The hike is expected to make the Netherlands a more expensive destination, potentially impacting its competitiveness in the European tourism market. Amsterdam already imposes a 12.5% local tourist tax, making the combined fiscal burden particularly high.

Outlook for Dutch Tourism

As the January 1, 2026, implementation date approaches, the Dutch tourism sector is bracing for a challenging period. While the government aims to secure additional fiscal resources, the industry fears that the significant VAT increase could reshape the landscape of travel within the Netherlands, potentially leading to reduced tourism activity and broader economic repercussions for businesses reliant on visitors.