Cruise holidays should ‘pay their fair share’ of tax, given their environmental impact and contribution to overtourism, a new study by Transport & Environment (T&E) has suggested.
According to T&E, a night on a cruse ship is taxed almost half as much as a night in a hotel, despite what it described as the industry’s ‘high environmental and climate costs’, with the group calling for tax reforms to address this imbalance.
The study compared the taxes paid on €100-per-night hotel stays and cruises in France, Italy and Spain, and found that hotel guests pay an average of 23% of the room price in taxes, while cruise passengers pay around 12%, meaning a night on a cruise is taxed almost 40% less than an equivalent stay in a hotel.
“We are treating floating hotels like they are essential maritime infrastructure,” commented Fanny Pointet, shipping manager at T&E. “Cruises are not a mode of transportation but the destination itself, yet we are giving them the same benefits as freight transport. Taxing cruise ships properly would help cities to tackle the pollution and to address concerns of overtourism.”
Environmental cost
As T&E noted, the estimated environmental costs linked to emissions and air pollution from cruise ships operating in France, Italy and Spain stood at between €790 million and €1.3 billion in 2025. On average, the climate-related external costs of this sector exceed ETS revenues by a factor close to two to three, it said.
T&E has called for the introduction of a €15 levy per passenger for every port call, a process that would generate around €335 million annually across France, Italy and Spain, and support environmental protection measures in coastal areas, as well as the rollout of onshore electricity connections for berthed ships.
“A cruise ship levy must be viewed as part of a broader regulatory mix. To fully mitigate the sector’s environmental footprint, parallel supply-side policies are necessary,” Pointet added.
Strengthened regulations
T&E also recommended strengthening EU regulations on sustainable marine fuels (FuelEU Maritime) and tightening energy efficiency benchmarks, as well as potentially capping the number of cruise ship arrivals at ports each day, or over the course of a year, to reduce environmental impact.
The report cited research from the ICCT, which indicated that cruise passengers generate between two and four times more carbon dioxide than holidaymakers who travel by air or car and stay in hotels. Read more here.
