Turkish tourism on its way for another squeeze following a new levy that will hit hotels and travel agencies starting October.
Tourism businesses in Turkey throughout the recent period had to offer discounts and low prices in an attempt to overcome a blow that hit the tourism sector three years ago.
According to Reuters, half-year figures released this week show a healthy 13% increase in foreign arrivals to Turkey, while a 10% jump in revenue for the sector to $12.6 billion has given a valuable boost to an economy still stuck in recession.
The declared levy, however, requires hotels and travel companies to pay up to 0.75% of their total revenues to Turkey’s newly founded Tourism Promotion and Development Agency.
This will significantly erode profit margins, businesses say.
In 2016, tourism to Turkey plummeted after a series of bombings, a failed military coup and a crisis with Moscow after Ankara shot down a Russian jet on the Syrian border.
Many firms were forced to slash prices to lure visitors and figures show average spend per tourist is still down by a third from its peak of $974 in 2013.
Businesses affected by the levy, which will be paid monthly from October, include accommodation facilities, food and drink outlets licensed by the ministry, travel agencies and private airport and terminal operators.