Tourism Boom Prompts Japan to Consider Dual Pricing System

As the yen weakens, Japan is witnessing a significant surge in tourism, leading businesses to consider implementing a dual pricing system, potentially charging foreign visitors higher prices. This move aims to address rising operational costs and ensure a fair distribution of expenses among locals and tourists.

Also read: New Requirements for Multiple-Entry Japanese Visa 2024

What we know so far about the Japan dual pricing system 

In June 2024, Nikkei Asia reported that Japan's restaurant industry was exploring a two-tiered pricing system in popular tourist spots. The chairman and president of Watami, a major restaurant chain, explained that while Japanese locals rarely purchase expensive items like 3,000 yen sirloin beef skewers, tourists find them affordable and buy them in large quantities. This discrepancy in purchasing power has prompted discussions about adjusting prices for tourists.

On 23 Jul 2024, Mainichi highlighted that businesses and entities support the dual pricing system due to rising labour and operational costs. A restaurant owner mentioned the need to hire and train English-speaking staff to cater to foreign customers, adding that passing these additional costs onto local patrons would be unfair. Instead, they propose charging tourists slightly higher prices to cover these expenses.

Himeji Castle, a UNESCO World Heritage Site, is also considering separate charges for foreign tourists. Currently, an adult admission ticket costs JP¥1,000 (around ₱384). According to NHK, Himeji Castle had 1.48 million visitors in the last fiscal year, with 30 percent being foreigners. The Himeji Mayor emphasised the high costs of maintaining and preserving the castle, including materials, repairs, specialised craftspeople, and earthquake resistance fortification. He suggested a slight difference in fees between different visitor categories, such as children, the elderly, and sightseers, to balance these expenses.

Adapting to changes

Some businesses are adopting alternative approaches to manage the influx of tourists. A Tokyo restaurant offers discounts to locals instead of increasing prices for foreigners. The owner stated, "I think people are more understanding about offering a discount to domestic customers, rather than raising the price for foreign tourists." This strategy has been well-received by customers, who appreciate the effort to support local patrons.

In Hiroshima, a restaurant designated Friday night as "Prefectural Citizens' Day," allowing only locals and repeat customers to dine. This initiative addresses the challenge of accommodating locals amidst a high volume of foreign diners, who account for over 80 percent of the restaurant's turnover.

Tourism policy expert Sataki Yoshihiro urged careful consideration when reviewing prices at attractions like Himeji Castle. He argued that fee differences based on nationality might be perceived as unfair, especially as Japan promotes inbound tourism. Sataki emphasised that if there is to be a difference in fees, the rationale should be clearly explained, and additional services or value should be provided for foreigners. "There shouldn't be a higher fee just because a customer is a foreigner," he concluded.

Also read: Japan Foreign Residents Surge Hit Record High Amid Citizen Decline

As the government navigates the complexities of balancing tourism growth and local interests, the Japan dual pricing system represents a potential solution to manage the economic impact of rising tourist numbers.

Featured image credit: Rudimencial via Canva Pro