Complaints mount over higher hotel rates under subsidy scheme

Consumers complain that hotels have hiked prices to coincide with the government’s travel subsidy program.

Some have even accused the hotels of deliberately raising their rates to get the reduced amount for themselves through the program.

Although the Japan Tourism Agency has called on accommodation establishments not to set inappropriate prices, local officials said it was difficult to determine a level of price increase that would be appropriate.

The government launched a domestic tourism program in April 2021, offering a subsidy of up to 5,000 yen ($34) per night to residents staying at hotels in their prefecture.

The program was later expanded to include neighboring prefectures, with the exception of Tokyo.

This program ended on October 10 and was effectively replaced by the new subsidy program which will cover all regions of Japan for domestic travelers.

Local governments received requests from their residents for higher hotel rates that went into effect around the same time the subsidy program began.

A 30-year-old entrepreneur living in Tokyo was shocked when she tried to book a room at a hotel in Yamanashi Prefecture for late November.

When she stayed at the same hotel on the same day last year, the cost of a room for two adults without meals was around 10,000.

But this year, the price was 38,000 yen. So she looked for other hotels.

His usual travel companion, a company employee, lives in another prefecture and can only travel on weekends, when hotel rates are higher.

The travel grant program offers larger gift certificate amounts for weekdays.

“What kind of people can travel on weekdays? asked the woman. “For those who can only travel when it’s more expensive and congested, there’s only dissatisfaction.”

A Yamanashi Prefectural government website posted various messages from travellers, including one stating that the asking price for a room was 10,000 yen while in the past the same room was only 7,700 yen.

Others said the higher prices meant there was really no benefit to getting a discount with the subsidy.

Officials in Okinawa and Iwate prefectures contacted specific accommodation establishments to find out why they raised their rates.

A property manager said: “We have increased the price to maintain a balance between supply and demand as there has been a sudden increase in inquiries and bookings.”

Before the program began, JTA issued guidelines to prefectural governments on how the money would be distributed.

The agency asked prefectural governments to monitor hotels to prevent subsidies from being applied to inappropriate price increases. Prefectural governments have also been told to take tough action if they confirm inappropriate rate increases.

The Saitama Prefectural government has secured promises from hotels that they will not raise rates for excessive profit.

JTA officials said hotels that act improperly could be removed from the travel subsidy program.

But prefectural government officials said it was unclear when a price increase was inappropriate.

“Prices fluctuate depending on the season and room availability, so it’s difficult to make overall comparisons,” a Nagasaki prefectural government official said.

A Niigata Prefecture government official said, “We are not looking at what prices are set.

Others said the overall spike in consumer and energy prices across the country had made price hikes inevitable in some cases.

(This article was written by Go Takahashi and Sachiko Miwa.)

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