Skift Take

The two-tier pricing debate enters its Japanese edition with businesses trying to strike a balance between catering to loyal local customers while staying true to Omotenashi (Japanese hospitality).

Hideyasu Kiyomoto, the mayor of Himeji City in Japan, this week proposed a significant price hike for foreign tourists visiting Himeji Castle, a UNESCO World Heritage site. Currently, the entry fee is JPY 1,000 (about $6) for all, but the mayor suggested increasing it to around $30 for foreigners, while locals would pay $5. 

The extra revenue would help with maintenance and to counter overtourism.

A restaurant in Tokyo is already testing two-tier pricing. Tamatebako in the city’s Shibuya neighborhood charges locals JPY 5,478 ($36) for a weekday lunch buffet, while foreigners pay JPY 6,578 ($42). For dinner, locals pay JPY 6,578 ($42), and foreigners JPY 7,678 ($49).

The higher price for foreigners is considered the official rate, with a “discount” for “Japanese and foreign residents in Japan.” To get the discount, customers must show proof of Japanese nationality or residency.

The menu that specifies the discounted price for Japanese locals and mentions that proof of Japanese nationality or residency is essential to avail the discount. Source: Tabelog

Earlier this year, Osaka Governor Hirofumi Yoshimura proposed a special tourist tax ahead of the 2025 World Exposition. The amount has not yet been discussed.

The goal of these ideas is to limit over-tourism and help locals who are getting priced out. 

In Japan, citizens need to contend with a weak yen and sluggish wage growth even as there is an inbound tourism boom: On Wednesday, the country announced that it had its third straight month with more than 3 million tourists in May. 

Global Comparisons

While restaurants charging two-tier pricing may be unique, there are several examples of foreigners paying higher prices at popular attractions.

The entry fee in India’s Taj Mahal is INR 50 for domestic tourists, INR 540 for citizens of Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan, Sri-Lanka, Myanmar and Thailand and INR 1100 for other foreign tourists.

In Jordan’s Petra, the entry fees for locals is JD 10 while foreigners pay JD70. The Kinabalu Park in Malaysia charges RM 10 from Malaysians while foreigners pay RM 50. Machu Pichu too charges $75 from foreigners while those from Andrean countries like Colombia, Bolivia and Ecuador pay $47.

Egypt’s Great Pyramids, St Petersburg in Russia, Angkor Wat in Cambodia are all places where foreigners pay more than locals.

In Asia, the Malaysian Budget and Business Hotel Association in 2022 had called for a two-tier system for room rates, with foreigners paying more for accommodation than locals. But that didn’t happen.

At the Metropolitan Museum of Art in New York City, admission is $30 for all but New York State residents can choose the amount they pay, as long as it’s “something.”

Deter Travelers?

Asked if something like this would deter budget travelers, Gary Bowerman, director of travel intelligence firm Check-in Asia, said it would depend on the price differences.

Bowerman noted that the initial fee disparity could prompt backlash, likely leading to revisions. In Bali, for example, the governor made various comments over the past couple of years about introducing a tourism quota, banning mountain tourism, stopping motorbike rentals, and more. Most of those proposals have been watered down.

“When a governor or mayor makes such statements, they tend to moderate the policy after consulting with stakeholders,” said Bowerman.

Michelle Lyons, founder of Point North, a branding and strategy firm specializing in Japan’s tourism industry, noted that while this model may deter price-conscious tourists, it could lose effectiveness over time as people adapt to higher prices, much like inflation.

Some say Chinese tourists visiting Japan may dislike differential pricing, but many may accept it since there are many examples of two-tiered pricing for residents and tourists.

Reacting to news about the Himeji mayor’s proposal, a user on X noted, “Japan needs to get its messaging sorted out. Do they want tourism or not?” 

Reacting to whether such measures help counter overtourism, Bowerman said that as tourism becomes a highly political issue in high-traffic destinations, authorities often end up making populist statements. “But, the Himeji government admits its new tourism tax is for revenue, like most others. Overtourism is a supply and demand issue and it can’t be solved by taxing the demand side without tackling supply. European cities, for example, limit daily visitors to popular attractions.”


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Tags: asia monthly, europe, heritage, japan, malaysia, overtourism, restaurants, thailand, tourism tax, travel influencers

Photo credit: The mayor of Himeji has proposed a significant price hike for foreign tourists visiting Himeji Castle. tawatchai07 / Freepik

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