The German federal government is taking new steps to help the tourism industry, addressing a long-standing point of contention regarding the fees for the crucial Travel Safety Fund. The government has decided to halve the current charges levied on the sector. Furthermore, the fund’s security concept will be revised, which is expected to incrementally lower overall costs.
Christoph Ploß (CDU), the federal government’s tourism coordinator, informed the Handelsblatt of these changes, stating, “We are strengthening the competitiveness of Germany’s tourism sector by continually improving the framework conditions for the tourism industry.”
The Travel Safety Fund was initially established in 2021 following the bankruptcy of Thomas Cook. Its purpose is to intervene when a package tour operator defaults. Larger tour operators are required to obtain coverage through the fund. However, the industry has long criticized the associated costs, arguing that these expenditures are unnecessary given the current strong market conditions.
Following a prior reduction of the fees by the government last year, the administration is taking further action. Starting in November, providers will need to contribute 0.25% of their package tour revenue to the fund. Additionally, the overhaul of the fund’s security framework should reduce the cost of insuring against liability via banks and insurance companies. According to information from the Handelsblatt, these measures are projected to alleviate the financial burden on the industry by an estimated 630 million euros annually. Ploß commented that these funds can now be invested instead of sitting idle in an already robust reserve.
