Which Countries Will Charge You To LEAVE?

Summary

This video explores the taxes levied on international travelers, including expatriation, departure, and tourist taxes. It highlights how countries like Eritrea and the USA tax residents based on citizenship, not just location. The script delves into Aviation taxes, with examples from the UK and Europe, and discusses the variability and complexity of these fees. It also addresses the controversial nature of tourist taxes, which can be high in places like Houston and are often a point of contention between local residents and the tourism industry. The video concludes by questioning the fairness of these taxes and their impact on tourism, inviting viewers to consider if such taxes are beneficial or detrimental.

Takeaways

• 🌍 There are three main types of taxes that can be charged to international travelers: expatriation tax, departure tax, and tourist tax.
• 🏦 Expatriation tax is significant for citizens of Eritrea and the United States, as they are taxed on worldwide income regardless of residency.
• 💼 The foreign tax credit helps mitigate double taxation for US citizens and Eritreans, but the exact amount changes annually and isn't explicitly listed by the IRS.
• ✈️ Departure taxes vary widely by country and can be based on factors like distance traveled, class of service, and the number of passengers on the flight.
• 🇬🇧 The UK has a complex system for departure taxes, with rates that depend on the distance from London to the destination capital city and the seat class.
• 🌆 Tourist taxes are charged by some cities and countries to fund local services and can range from a small percentage of the accommodation cost to a significant amount.
• 🏙️ Some cities, like Barcelona, have introduced or increased tourist taxes as a measure to manage tourism and its impact on local communities.
• 🗺️ France receives the highest number of tourists globally, followed by Spain and the United States, indicating the popularity of these destinations.
• 💸 Tourist taxes are not only a revenue source but also a tool to manage tourism and ensure that visitors contribute to the cost of services they use.
• 🌐 The script suggests a trend of countries and cities becoming more selective about the type of tourism they encourage, favoring higher-value tourists over mass tourism.

Q & A

What are the three major ways countries charge fees when you travel internationally?

The three major ways countries charge fees for international travel include expatriation tax, departure tax, and tourist tax.

What is an expatriation tax and which countries are known for having it?

An expatriation tax is a tax on individuals who are leaving their country of residence. The United States and Eritrea are known for having this type of tax, where citizens are taxed on their worldwide income regardless of where they live.

How does the foreign tax credit work for US citizens living abroad?

The foreign tax credit allows US citizens living abroad to claim a credit for taxes paid to foreign governments on foreign income. The amount of the credit can change yearly, but the IRS does not list the exact amount on their website.

What is a departure tax and how does it vary by country?

A departure tax is a fee charged when leaving a country. It varies by country and can be based on factors like distance traveled, class of service, and the number of passengers on the flight.

Which country has the highest aviation tax and what is the amount?

Mexico has the highest aviation tax, which can be up to $65 for non-Mexican nationals without permanent resident status.

How are tourist taxes implemented in different cities and what is their purpose?

Tourist taxes are implemented differently in various cities, often as a percentage of the accommodation cost. Their purpose is to raise funds for local services and to manage the impact of tourism on the local community.

What is the significance of the tourist tax in Houston, and how much is it?

The tourist tax in Houston is significant because it is one of the highest at 17% of the lodging cost. It is used to fund public services and amenities.

Why are some countries and cities adopting anti-tourist measures and taxes?

Some countries and cities are adopting anti-tourist measures and taxes due to the negative impacts of mass tourism on local communities, such as increased housing prices and strain on public services.

Which countries receive the highest number of tourists according to the UN World Tourism Organization?

According to the UN World Tourism Organization, France, Spain, and the United States receive the highest number of tourists.

What is the speaker's opinion on the effectiveness of tourist taxes in managing tourism?

The speaker suggests that tourist taxes can be a double-edged sword, raising funds for local services while also potentially deterring tourists, which can affect the local economy.

What is the speaker's view on the countries with the lowest tourist taxes?

The speaker seems surprised that some countries have very low tourist taxes, implying that they might be missing out on potential revenue or that they might be more tourist-friendly.

Outlines

00:00

🌍 International Travel Taxes Explained

The paragraph discusses the three major types of taxes imposed on international travelers: expatriation tax, departure tax, and tourist tax. It explains that expatriation tax is tied to the country where one spends the majority of the year, with the United States and Eritrea being exceptions, as they tax based on citizenship. The script humorously touches on the IRS's foreign tax credit, which fluctuates annually without a clear listing on their website. It then transitions into a discussion about aviation taxes, highlighting the variability and complexity of these fees across different countries, using a hypothetical flight from New York as an example. The paragraph concludes with a critique of how these taxes are often not transparent and can be unexpectedly high.

05:02

✈️ Aviation Taxes and Their Global Impact

This section delves deeper into aviation taxes, emphasizing the disparities in the amounts charged by different countries. It points out that while the UK has some of the highest aviation taxes, the actual rates can vary significantly based on factors like flight distance and class of service. The script also mentions that some countries have closed loopholes that previously allowed travelers to avoid higher taxes. It provides a global perspective by comparing tax rates in Mexico, Fiji, and Australia, and discusses how these taxes can be a form of revenue generation for governments. The paragraph also touches on the public's reaction to these taxes and the notion that they might be seen as a way to make tourists 'pay their fair share'.

10:03

🏖️ The Debate on Tourist Taxes

The final paragraph shifts focus to tourist taxes, which are levied on visitors to certain cities or countries. It discusses the rationale behind these taxes, suggesting they are a measure to manage the impact of tourism on local communities and infrastructure. The script provides examples of tourist taxes in various European cities, noting the significant variance in rates and the complexity of their calculation. It also mentions the backlash against tourists in certain popular destinations, like Barcelona, where local residents have expressed frustration with the strain tourism places on housing and public services. The paragraph concludes by pondering the effectiveness and fairness of tourist taxes, questioning whether they are a positive or negative development in the context of global travel.

Keywords

💡Expatriation Tax

Expatriation tax refers to the tax levied on individuals who permanently leave their country of residence. In the context of the video, it is highlighted that the United States and Eritrea are unique in that they tax their citizens based on citizenship, not just residency. This means that American expatriates, for example, are taxed on their worldwide income, regardless of where they live, unless they formally relinquish their citizenship.

💡Departure Tax

A departure tax is a fee imposed on travelers leaving a country. The video script discusses how these taxes vary widely by country and can be included in the cost of an airline ticket. It uses the example of the UK having a complex system based on the distance of the flight and the class of service, with rates ranging from £7 to over £600.

💡Tourist Tax

Tourist tax is a levy imposed on visitors to a particular city or region, often to fund local services or attractions. The video mentions that these taxes can vary significantly, with some cities like Houston charging a high percentage of the accommodation cost. The script also touches on the debate over whether such taxes are fair and their impact on tourism.

💡Tax Resident

A tax resident is an individual who is subject to tax in a particular jurisdiction, typically based on the amount of time they spend there in a year. The video explains that spending over 183 days in a country can make one a tax resident there, which is a crucial concept when discussing expatriation tax.

💡Foreign Tax Credit

The foreign tax credit is a mechanism that allows taxpayers to offset taxes paid to foreign jurisdictions against their domestic tax liability. The video humorously notes the IRS's approach to this credit, which changes annually and is not explicitly stated on their website, adding a layer of complexity for taxpayers with international income.

💡Aviation Taxes

Aviation taxes are fees associated with air travel, often included in the cost of an airline ticket. The video provides an in-depth look at how these taxes can vary by country and the specific types, such as the passenger civil aviation security service fee and the US passenger facility charge.

💡Tax Loopholes

Tax loopholes are legal provisions or practices that allow taxpayers to reduce their tax liability. The video discusses how some countries have closed loopholes related to departure taxes, ensuring that travelers contribute to the costs of services used, regardless of the technicalities of flight distances or connections.

💡VAT (Value-Added Tax)

Value-Added Tax is a consumption tax placed on a product whenever value is added at each stage of the supply chain. The video mentions VAT in the context of tourist taxes, where an additional tax is levied on the tourist tax itself, highlighting the complexity of tax systems.

💡Anti-Tourism

Anti-tourism refers to sentiments or policies that are hostile or critical of tourism, often due to its perceived negative impacts on local communities or environments. The video discusses how some cities have implemented tourist taxes as a form of anti-tourism measure, aiming to manage tourism's impact and raise funds for public services.

💡Tourism Arrivals

Tourism arrivals refer to the number of visitors arriving in a country or region for tourism purposes. The video uses data on tourism arrivals to discuss the popularity of certain destinations and how this influences the implementation of tourist taxes.

💡High-Value Tourists

High-value tourists are those who spend more and contribute more to the local economy. The video mentions how countries like New Zealand are adjusting their policies to attract high-value tourists rather than a larger number of visitors, which can be seen as a strategic approach to tourism management.

Highlights

Three major ways countries charge travelers: expatriation tax, departure tax, and tourist tax.

Expatriation tax is based on spending over 183 days in a country, making you a tax resident.

U.S. and Eritrea tax residents based on citizenship, not just residency.

Foreign tax credit available to U.S. citizens, but the amount changes yearly and is not listed by the IRS.

Aviation taxes vary by country and can be included in flight ticket prices.

UK has some of the highest aviation taxes, with rates based on flight distance from London.

Tourist taxes are charged in many countries, with rates differing significantly.

Houston, Texas, has a notably high tourist tax of 17% on lodging.

Tourist taxes can be used to fund local services and amenities.

Some countries are introducing tourist taxes to manage tourism and its impacts.

France receives the highest number of tourists, followed by Spain and the United States.

Anti-tourism sentiments are growing in popular tourist destinations.

New Zealand recently increased its tourist tax, aiming to attract higher-value tourists.

The video concludes with a question about the viewer's stance on tourist taxes.

The presenter expresses surprise at the list of most visited countries, particularly France's top position.

The presenter suggests visiting lesser-known destinations like St. Kitts and Nevis.

The presenter hints at future travel content, including live streaming from visited countries.

Transcripts

hello I'm toy cat and there are three

major ways that countries charge you

when you travel internationally the

first is an expatriation tax the second

is a departure tax and the third is the

dreaded tourist tax let's talk about

examples and the extent of all three as

well as the countries that do them the

worst and let's start by mentioning the

expatiation tax because fun fact you are

a tax resident of where you spend most

of your time in a year this means

basically by default if you spend over

183 days somewhere you'll become an

automatic tax resident of that place and

you only usually play taxes to one

government unless you live in one of

these two places so this is erria and

this is a country you might not be

familiar with but it's the United States

of America I I've heard after Googling

and if you are from one of these two

places you don't just pay tax based on

where you live if you live in Germany

for example you'd pay German taxes but

you'd also pay tax based on your

passport which means to The American or

to the aitran government this is a very

big deal and honestly I think the only

reason we don't make more of a fuss

about it is because it only really

applies to wealthy people because of the

foreign tax credit which fun fact it

changes every year but the IRS does not

list exactly how much it is on their

website instead they just say yeah

you've got to claim for it if you have

foreign taxes on your income your War

profits or excess profits and I just

think it's hilarious that not only does

the IRS insists that if you're going to

be making money profiteering on a war

that you pay your taxes on it but also

that they'll give you a tax credit for

that very very unbrand got to say uh and

so yeah as a result if you are from one

of these two countries you pay if you

earn any money outside of your country

country as if you never left your

country or you know at least with a tax

credit if you have which is kind of

nutty if you ask me speaking of things

that are nutty if you ask me um let's

move on to Aviation taxes sorry wrong uh

tab let's move on to Aviation taxes here

because when it comes to leaving a

country this can get pretty expensive

based on the country you're going

through so as you can see this is just

map for Europe but every single country

has some form of a departure tax this is

often called something different which

is what makes it so hard if we look at a

flight that I'm booking right now fun

fact I'll be in the New York airport in

late January please don't come and see

me but I I I I think what is important

is the fact that if you uh look at this

ticket you can see not just this huge uh

popup window saying hey I know that you

specifically look for basic economy but

would you like to give us more money to

sit in the exact same seat uh as well as

seeing that you'll also see a taxes and

fees section which lets you see that

although you're paying £39 the actual

Fair the airline gets is 285 because

they have to pass on like you know the

the passenger civil aviation security

service fee the US passenger facility

charge and just a blanket Transportation

tax are you on Transportation better

take pay your tax and I think that's

kind of funny pule but I also think it's

worth mentioning that this therefore uh

you know tells you that every country

has different fees that all do the same

stuff this is all going to the US

government sure this might only

technically cover the passenger

facilities that they're charging you for

but I doubt it actually works out

exactly that way and so Aviation taxes

are kind of messy because every country

will charge you different amounts and

these are just averages so in the UK we

have the highest Aviation taxes in I

believe the world the highest departure

tax in the world but it's not 40 EUR

it's more or less based on when and how

you're flying so um basically this it

used to be there were just two bands If

you flew more than 2,000 miles you paid

a different rate to less than 2,000

miles but now the way it works is based

on the distance from London to the

destination capital city if it's 0 to

2,000 miles you pay one rate if it's uh

less than 5,500 mil you pay a rate and

if it's over 5,500 mil you higher rate

but what's really weird about this is

this sounds like oh London to

destination Capital City there's got to

be some loopholes there so for example

if you are flying to the Far East of

Russia Russia's capital is really close

to the UK Moscow it's uh just under

2,000 miles but if you wanted to fly to

the Far East of Russia it would be more

like 5,000 miles would you pay the lower

taxes what about stuff like the Cayman

Islands the capital of Bermuda or the

capital of the Cayman Islands are

actually London I mean based on the

country they're in so as a result would

you and the answer is no they got really

boring and they closed all these

loopholes saying that yeah Russia is a

separate country east of the Euros which

I think is kind of what nuts I also

think excluding Puerto Rico and the US

Virgin Islands is another wacky decision

they're also and the British Virgin

Islands and everything else they've

worked out basically how to remove all

the loopholes and so it's just distance

from London to the city you're flying

basically which there a whole point for

another day geography nerds we should

get savings on taxes if we're willing to

work out the best loopholes and stuff

like this but what I also think is

interesting is if you look at it's based

on the seat that you're in so you pay a

higher rate if you have more leg room

and you pay an even higher rate if your

plane has fewer than 19 passengers and

it means that actually the departure tax

from the UK is between £7 and

£607 wait between I guess as of 2025 it

will be £7 and

673 this is quite high of course and it

means that it's it's it's kind of uh

it's very hard to actually say that the

tax for leaving the UK is just this this

is why I think the much more useful St

is the depart tax article on Wikipedia

it still misses certain uh you know like

Aviation taxes but you can see the very

highest tax in the world is apparently

Mexico at

$65 wow I did not know it was so high I

feel like I've booked flights out of

Mexico for less than 65 US Dollars and

I'm a non-mexican national and I do not

have permanent resident status or and I

was connecting flight though okay there

we go simply explained so yeah the

highest tax that everyone pays in the

world is Mexico fun fact that's actually

kind of nutty to hear Fiji pays a decent

amount too and Australia is pretty high

up but again it's the passenger movement

charge it's really just for the the

point here is to say is that it's

actually very hard to compare departure

taxes countries that officially have no

departure taxes so if we uh we scroll

all the way down here you can see that

like well technically speaking uh there

are some really low taxes when you leave

brunai but I bet you still have to pay

for all those border security fees Etc

and so it's actually not easy to compare

these uh in a like to like way which is

why I want to instead talk about the

final category because fun fact as much

as I love uh departure taxes as much as

I love the fact that if you're from one

of these countries you get a little bit

screwed on your uh your your ability to

move countries I think one of the

weirdest taxes in terms of the reaction

from people is that of tourist taxes so

here's a fun uh map from Globe Hunters

where they just show each uh country and

where they have tourist taxes in the big

uh in the two biggest Austrian cities

there is a 3% tourist tax in Belgium

it's fixed at

€249 or €250 or €2 um in Brussels I want

to tell you it is the most insane

formula when they say a rather

complicated formula is used to work out

the tax here um trust me when I'm they

are not making that up I stayed in

Brussels when I was like 19 and they

were like yeah so there is this tourist

tax here but then you've got to pay VAT

on the tourist tax but then you have to

pay VAT on the vat and that sounds made

up but it was for like €8 so I doubt

they were just trying to SC me either

they didn't understand what was going on

with their system or they or ultimately

what I'm saying is no one in Brussels

understands how the tourist tanks

seemingly Works in Prague it's really

really low in Paris it's incredibly low

uh whereas in Germany it goes up quite

high in some places and if we again if

we uh skip through these fun uh diagrams

you can see there are some actually

fairly High tourist taxes in the world

with the most notable example that

Wikipedia calls out being uh the Houston

city which charges 177% of the cost of

lodgic deily presumably because lots of

people are going there you know no one's

going to Houston because they're like oh

yeah I've heard it's a beautiful city

lots of sites to see you're there on

business and so your employer pays a 17%

tax and so the Houston city can fund

their zoo and their Fine Arts Museum and

what what do cities in America you have

to fun there the Eleanor Tinsley Park I

I think I might have been in this one

actually anyway with that said uh the

important thing here is to say uh that

as a result uh tourist taxes are can be

very very high but they are high not

part to raise money I mean that's great

too right but raising a Euro of every

single person who comes into Lisbon is

going to raise you some amount right

like uh 45 cents a day in Barcelona but

it's sort of a anti-tourist it's sort of

a measure to raise a bit of money uh and

still seem like you're like yeah we're

going to make the tourists pay their

fair share because the world is coming

down against tourists very very hard

lots of cities and countries but

Barcelona is the most famous um lots of

cities are saying yeah we hate you

tourists you are ruining our country

tourists go home um it's it's kind of

funny we had this big wave of

anti-immigration in Europe like 10 years

ago and now we're having a wave of

anti-tourism don't don't come you can

come here to live if you want to but

don't you dare be coming here to visit I

I I dare if you come here and you spend

money and then you leave rather than

being a drainer on our government

services I would hate you for that and

obviously I'm being very factious here

because actually a lot of people believe

that people come in Via cruise ships and

people come in on a little dayour they

just come and look at the city they just

you know crowd up the streets they they

don't really put a lot of money into it

which is something which they would say

and in the case of Barcelona they're

upset because the prices of uh their

housing has gone up meanwhile everyone

keeps turning their Apartments into

airbnbs and obviously in actually

Dynamic markets it shouldn't matter if

the uh you know either you I I feel like

there is a fixed amount of housing

Supply increase the housing Supply and

then both tourists and citizens can live

but when you artificially constrain it

people feel like it's a choice between

people who live there and tourists and

so they tell the tourists to go home or

spray them with water guns uh which is

kind of sad you might be able to say but

when you think about it it's kind of

nuts because when you look at um so this

is the un uh World tourism organization

so their numbers uh basically uh work

out exactly how many people go into a

given country so we're going to talk

about tourism arrivals right and you can

see that the highest share of Tourism

arrivals is France followed by Spain

then the United States Italy turkey

Mexico the UK all all the countries that

you've heard that someone has gone on

holiday to are all listed right here but

interestingly about 8% of people who go

anywhere in the world go to France about

5% about 7% of people who go anywhere go

to Spain and that's kind of nuts when

you think about it on a proportional

level to have you know 40 million people

but then to get such a high percent of

the world's tourists or you know let's

use it as volume total shall we um to to

get uh more than your population more

than double your population tourists

each year means that lots of people are

going to encounter lots of tourists and

unlike citizens uh you know you can

scapegoat some of your citizens but then

they won't vote for you you can

scapegoat tourists all you like and what

are they going to do are they are they

going to have some issues of you and so

that's why lots of countries are turning

against uh tourists I do think that

ultimately it is why tourist taxes are

being introduced you need to make it

seem like tourism is a win-win you get

to visit a city but in exchange as well

as paying all the vat and all the other

weird fees you pay you just also got to

spend 4% of your price per room per

night and then you can fund some of

those government services that everyone

loves so much much and it's it seems to

be a reasonable compromise but what do

you think is the question I'm going to

leave today's video on do you think

tourist taxes are a good thing or a bad

thing because I think that uh there is a

real clo you know there is a real knife

edge of countries uh deciding yeah

actually we'd rather just have the

higher value tourists New Zealand just

changed their tax by the way this is

where the inspiration this video came

from it was $35 when I made my video

last week but it went up to hundred New

Zealand do it is very very very

expensive to go to New Zealand and they

basically decided yeah we would rather

have uh you know the P value tourists

rather than more of them and that leaves

other countries on the world you know

the uh the the turkeys the italies the

ETC to soak it all up side note one last

thing is everyone El shocked by this

list like I am shocked that France is

the most visited country on earth like

do those people not know that there are

other countries is something wrong with

them and uh I guess also I'm surprised

that the US is so low because there is

it is such a big country with so many

individual states and also I feel like

more people live closer to the United

States than to France I guess that can't

actually be true I guess if you count EU

movements then there's probably a big uh

boost to countries like France Germany

and Spain I wonder you know I I the UN

needs to get but I I would love to know

how this is all calculated also yeah the

UK being like the seventh most visited

country in the world uh feels like it

tracks to me but is that surprising to

you more people go to the UK than

Germany is is that doesn't trct to me at

all uh but is surprising is the fact

that no one goes to monserat or palao I

should go to monserat just to fix that

shouldn't I Dominica vatu anguila s kits

and the neice you know s kits and the

neice I've wanted I I believe uh that

you know I I I think I've got to go

visit you so let's let's go today what

does St kits and the nervous have St

kits and the nervous I believe Hamilton

was born there they've got a really

funky flag that no one ever suspects

from the region and they've got

Brimstone Hill Fortress National Park

let's go let's go give it a peek oh yeah

this is worth traveling to I you know

why have only what is that like 100,000

people went to St kits and NIS last year

that's that's a New Year's resolution

for me speaking of traveling by the way

I think I might be streaming on this

channel soon just as a fun uh little

thing I just got back from visiting my

my 52nd country and uh yeah I'm excited

to talk maybe about where we should go

in the future if you're excited for that

then stay tuned otherwise second Channel

don't care except I do care a little a

little bit love you really goodbye