Venice’s ‘tourist tax’ is being labeled a ‘miserable failure’—and the project might not break even this year

Faced with the threat of sinking and an economy that crowds out locals, Venice launched a measure last month that was as ambitious as it was contentious: a so-called tourist tax on day-trippers. But a few weeks in, the floating city has done little to prove it has found the solution to managing its love-hate relationship with 20 million annual visitors.

The northern Italian city has collected just under €1 million ($1.1 million) in fees in the first 11 days of charging visitors €5 ($5.36) to enter for the day, new data shows.

However, the charge doesn’t appear to have had the intended effect of deterring tourists from making the short stopover.

The latest data shows that 70,000 visitors came to Venice on May 19. That’s more than the 65,000 registered visitors on June 2 of last year, a national holiday in Italy and before the tourist tax was rolled out. Since its debut, 195,000 tickets have been sold to visitors.

If numbers weren’t down, Venice officials would have at least expected the tax to subsidize the economic contribution of traditionally stingy day-trippers, who don’t spend as much as longer-term visitors but make up 80% of Venice’s total traveling party each year.

But the tax may not help the city’s finances that much. If Venice keeps collecting at the rate it has in its first 11 days of operation, it may not even be able to cover the considerable outlay involved in implementing the project, at least during its trial period.

Between setting up an online booking system, launching informational campaigns, and paying officers to carry out ticket checks, Italian paper Corriere della Sera reported the city has spent €3 million ($3.3 million) on the project.

The tourist tax has been imposed on “29 peak days” between April and July as part of a trial period. Extrapolating from Venice’s current $1.1 million haul over the first 11 such days, the city may fall short of recouping its initial outlay before the end of July.

Local opposition

Whether the “tourist tax” is extended beyond its current trial period is up for debate, given the backlash it has received from locals.

Venetians gathered on the city’s streets in the buildup to the tax’s launch last month to protest its rollout.

Motivations for the opposition have been wide-ranging. Some locals fear it will turn Venice into a “theme park” and do little to enhance the city’s reputation on the world stage.

Others have accused Venice of using the entry fee as a diversion for the local government’s failure to address a housing crisis in the city.

“They should repair the thousands of abandoned houses in this city. However, that’s unlikely to happen. Instead, residents keep leaving, the city is emptying out, and all we’re doing is boosting tourism,” Venice resident Nicola Ussardi told Euronews last month.

Calls to scrap the tax have only gotten louder since the data showed it hasn’t reduced visitor numbers.

“The entry ticket measure in Venice has failed miserably because the numbers count, and they say that the ticket has in no way lowered the flow of tourists or staggered the arrivals, but instead the arrivals are numerically superior with respect to previous years,” Giovanni Andrea Martini, from city council group All The City Together, said at a press conference this week.

The “tourist tax” is only the latest move from the local government to rein in the effects of day-trippers.

In January, the city introduced a 25-person cap on congregating in the city, about half the number of passengers found on a typical tourist bus.

Venice’s relationship with its most lucrative source of income, visitors, is likely to remain complicated. But officials hope they can remedy this so-called miserable failure before disgruntled locals force their hand.

This story was originally featured on Fortune.com