GetYourGuide, the Berlin-based online marketplace for travel experiences, has confirmed it will begin implementing a surcharge on tour operators to offset the costs of Digital Services Taxes in five major jurisdictions. Starting October 1, the company will pass the financial burden of these national levies to its supply partners in the United Kingdom, France, Italy, Spain, and Turkey. This strategic shift reflects a broader industry trend where large digital platforms, originally the primary targets of these "Big Tech" taxes, are transferring the fiscal responsibility down the supply chain to smaller enterprises and service providers.
The move marks a significant evolution in the relationship between Online Travel Agencies (OTAs) and the independent operators who provide the tours, activities, and attractions sold on these platforms. Digital Services Taxes (DSTs) were initially conceptualized by European and international regulators to ensure that multinational technology giants paid taxes in the countries where they generate revenue, rather than shifting profits to low-tax jurisdictions. However, the practical application of these taxes has increasingly resulted in "pass-through" costs that impact the very small and medium-sized enterprises (SMEs) the regulations were often intended to protect or, at the very least, not penalize.
The Mechanics of the New Surcharge
GetYourGuide’s decision to implement these surcharges follows similar moves by other global technology leaders. In the UK and Europe, companies such as Amazon, Google, and Apple have previously adjusted their fee structures for third-party sellers and advertisers to account for DST obligations. For GetYourGuide, the surcharge will apply to the commissionable revenue generated by operators in the affected countries.
While the specific percentage of the surcharge varies by country—reflecting the differing tax rates set by national governments—the implementation is uniform in its timing. From October 1, operators will see these additional costs reflected in their billing statements. The tax is typically calculated based on the gross revenue generated from digital services provided within the specific territory. For a tour operator, this means that for every booking processed through the GetYourGuide platform, a portion of the fee will now be earmarked to cover the platform’s DST liability to the local government.
Historical Context: The Rise of Digital Services Taxes
The emergence of Digital Services Taxes is rooted in the perceived inadequacy of traditional international tax rules in the digital age. Under older frameworks, a company was only taxable in a country where it had a "permanent establishment," such as an office or a factory. Digital platforms, however, can generate billions in revenue in a country without having a physical presence there.
The timeline of DST implementation reflects a period of intense geopolitical and economic negotiation:
- 2018: The European Commission proposed a common DST for the European Union, but the initiative failed to gain unanimous support among member states.
- 2019: France became the first major economy to implement a national DST, a 3% tax on the revenue of digital companies with global sales of more than €750 million and French sales of over €25 million.
- 2020: The United Kingdom introduced its own DST at a rate of 2%, targeting social media platforms, search engines, and online marketplaces with global revenues exceeding £500 million and UK revenues exceeding £25 million.
- 2021: Italy and Spain followed suit with 3% taxes. Turkey implemented one of the highest rates at 7.5%.
- 2021–2024: During this period, the Organization for Economic Co-operation and Development (OECD) worked on a "Two-Pillar" solution to reform international taxation. While over 140 countries agreed to a global minimum corporate tax of 15% (Pillar Two), the implementation of Pillar One—which would replace individual national DSTs with a global revenue-sharing model—has faced repeated delays, particularly in the United States.
Because the OECD’s Pillar One has not yet been fully ratified or implemented, countries like the UK and France have maintained their national DSTs, leading to the cumulative financial pressure that platforms like GetYourGuide are now addressing through partner surcharges.
Data and Revenue Thresholds
The impact of DSTs is governed by specific revenue thresholds that determine which companies are "in scope." These thresholds are designed to exempt smaller domestic startups while capturing global players.
In the United Kingdom, the DST applies if a company’s global revenue from digital activities exceeds £500 million and its UK-specific revenue exceeds £25 million. In France and Spain, the thresholds are generally set at €750 million globally and €25 million or €3 million respectively in local digital revenue.
For GetYourGuide, which has seen explosive growth in the post-pandemic travel surge, crossing these thresholds in multiple European markets has transformed the DST from a theoretical regulatory risk into a substantial operational cost. According to industry data, the tours and activities sector is one of the fastest-growing segments of the travel industry, with digital penetration increasing as consumers move away from offline bookings. This growth, while positive for revenue, has simultaneously triggered higher tax liabilities under the DST frameworks.
Industry Reactions and the "Trickle-Down" Effect
The reaction from the tour operator community is expected to be one of concern, as many small businesses are still navigating the inflationary pressures of a post-COVID economy. For a local tour guide or a small boat charter company, a 2% to 7.5% surcharge on their platform fees can significantly erode profit margins.
While GetYourGuide has not issued a formal public statement beyond confirming the change, the logic behind the surcharge is consistent with platform economics. OTAs operate on commission models that typically range from 20% to 30%. When a government imposes a 3% tax on the total revenue of the marketplace, it represents a much larger percentage of the marketplace’s actual commission income. To maintain its own margins and continue investing in marketing and technology, the platform views the passing on of these costs as a necessary fiscal adjustment.
Market analysts suggest that this move could lead to a "trickle-down" effect on consumer pricing. Tour operators, faced with higher costs to sell through GetYourGuide, may choose to raise their retail prices to maintain their net earnings. Consequently, the traveler may ultimately end up paying for the Digital Services Tax through higher ticket prices for museum tours, cooking classes, or city excursions.
Comparative Analysis: The Global Landscape
GetYourGuide is not alone in its approach. The precedent was set several years ago when the UK first introduced its DST. In September 2020, Amazon informed its UK third-party sellers that it would increase referral fees and other charges by 2% to cover the tax. Google followed by adding a surcharge to advertisements served in the UK, Turkey, and Austria.
The travel sector has been particularly sensitive to these changes because it relies heavily on cross-border transactions. In Turkey, the 7.5% DST is one of the most aggressive in the world. For operators in Istanbul or Cappadocia, the GetYourGuide surcharge will be particularly noticeable compared to the 2% surcharge in the UK. This creates a fragmented pricing landscape where the cost of doing business digitally varies significantly by geography.
Broader Implications and Future Outlook
The decision by GetYourGuide highlights the ongoing tension between national fiscal policies and the global digital economy. As long as the OECD’s Pillar One remains stalled, individual nations will likely continue to use DSTs as a tool to capture revenue from digital trade.
For the travel industry, this situation underscores the dominance of major OTAs. While operators may be frustrated by the surcharges, GetYourGuide’s massive reach and marketing spend make it a vital distribution channel that most operators cannot afford to leave. This dependency allows platforms to pass through regulatory costs with relatively low risk of mass supplier churn.
However, there is a potential for long-term shifts in the market:
- Direct Booking Incentives: Operators may increase efforts to drive bookings through their own websites to avoid platform surcharges and commissions.
- Regulatory Scrutiny: Increased costs for SMEs may prompt some governments to reconsider the design of their DSTs or provide exemptions for smaller partners.
- Consolidation: Smaller tour operators with thin margins may struggle to absorb these costs, potentially leading to consolidation within the local tour and activity markets.
As the October 1 deadline approaches, GetYourGuide is expected to provide its partners with detailed guidance on how the surcharges will be calculated and displayed in their accounts. For the broader tech and travel sectors, this move serves as a stark reminder that in the world of international taxation, the costs of targeting "Big Tech" rarely stay at the top; they almost inevitably find their way down to the local businesses and consumers at the heart of the digital marketplace.
