Borg proposes May-to-October limit on Malta tourist eco-tax rise

Opposition leader Alex Borg said on Sunday that the higher tourist eco-contribution should apply only from May to October, not year-round. He said he would put the proposal forward in his Budget reply on Monday. He spoke at a Nationalist Party event at the Opposition leader's office in Valletta, MaltaToday reported.

The Budget measure

Finance Minister Clyde Caruana announced the increase in the Budget 2027 speech last Monday. From 2027, the eco-contribution rises from €1.50 to €8 per person per night in hotels and other collective accommodation, capped at €64 per person per stay. Short-term rentals go to €10 per person per night, capped at €80 per person per stay. The hotel rate is more than five times the current charge; the short-let rate is almost seven times. The charge applies to tourists aged 18 and over, and English-language schools are exempt from the accommodation contribution.

The government expects the revised accommodation contribution to generate about €182 million a year. That estimate covers accommodation charges only, not the combined revenue from all the new tourism measures. Caruana said Malta is on course to exceed 4.5 million tourists this year, accounting for around 28 million nights, with both figures expected to rise again in 2027. He linked the increase to investment in tourism infrastructure and to visitors benefiting, directly or indirectly, from subsidised energy prices.

Borg's argument

Borg argued that tourism should contribute to the country's infrastructure, but said the government gave no word on where the money will go. He said it took the measure without a serious plan. He added that tourist numbers and average daily rates differ between peak and shoulder months. "For the government's mistakes, you pay," he said.

For a couple staying seven nights in a hotel, the new charge would be €112, against €21 at the current rate, Lovin Malta reported. Calculated at the announced short-let rate, four adults staying seven nights would pay €280 in eco-contribution alone; at the current €1.50 rate the same stay would cost €42. Flights, food and the apartment itself come on top.

Operator cancellations

Short-let operator André Grech said he received four booking cancellations in two days after the announcement. He said some were bookings carried over from an earlier period, while others involved families planning holidays in Malta's quieter shoulder months, not summer party groups. He said he knew of no operators consulted before the decision. He warned that when a family cancels, other local businesses lose that spending too, and suggested lower charges in quieter months and higher rates in summer. The direct cause of the cancellations has not been independently confirmed.