Taiwan Sees Three to Five Percent Price Increase in Domestic Tourism, Impacted by the Rising Costs and Decline in Domestic Travel Growth Due to Preference for International Trips

Published on November 22, 2025

The Travel Quality Assurance Association of Taiwan has just announced recommended prices for domestic tours in the first quarter of 2026, estimating that tour prices will increase by 3% to 5% over the same period in 2025. All tour prices have risen in reaction to higher accommodation and transportation costs, in addition to increased labor costs over the past year. Expected adjustments of sightseeing fees at major popular scenic spots throughout Taiwan have forced the rise in tour prices for the coming year. In fact, the first quarter falls in the middle of two big travel peaks: winter break and Lunar New Year holiday. Both long breaks result in a surge in demand for domestic travel, pushing prices closer to peak-season levels.

Impact of Seasonal Demand on Pricing

Despite the general price increases, weekday rates for one-day tours are expected to remain largely unchanged. However, mid- to high-end two- or three-day tours are likely to experience modest price hikes due to increased demand and rising operational costs.

The Lunar New Year holiday in particular, which is one of the most significant travel periods in Taiwan, is expected to contribute to higher prices as tourists flood popular destinations across the island. The surge in demand during these holidays, combined with the economic pressures on travel companies, makes price increases almost inevitable.

Domestic Tourism Faces Growing Challenges Amid Rising Interest in International Travel

The Taiwanese domestic tourism market is facing several challenges as more travelers opt for international trips. According to data from the Tourism Administration, the number of outbound travelers surpassed the number of inbound visitors by over 8 million between January and September 2025, resulting in a widening tourism deficit compared to the previous year.

This shift towards international travel has prompted concerns that domestic tourism may be losing its appeal. Tourism Administration Director-General, Chen Yu-hsiu, noted that three key factors are affecting domestic tourism demand: the preference for day trips rather than overnight stays, high accommodation costs, and the crowded weekend conditions caused by a concentration of travel on weekends, leaving weekdays less active in comparison.

The Tourism Impact: Loss of Local Revenue and Tourism Jobs

The rise in outbound travel and the decline in domestic tourism is having a noticeable impact on the local economy, especially in tourism-dependent regions. Tourism businesses, including hotels, restaurants, and tour operators, are struggling with fluctuating demand and increased costs, which have made it harder to offer competitive packages. As a result, there is a growing loss in tourism revenue that would otherwise flow into local businesses, affecting job creation and economic growth in tourist-heavy areas of Taiwan.

This trend is worrying as domestic tourists, who were once a major source of revenue, are opting for international destinations where lower costs, greater variety, and more attractive offers have become the new norm. Many regions in Taiwan now face the challenge of diversifying their tourism offerings to remain competitive. As Taiwanese travelers increasingly favor more affordable international options, the local tourism industry may face sustained struggles without immediate interventions aimed at revitalizing local travel experiences.

Shifting Preferences: Domestic and International Travel as Complementary

While domestic tourism in Taiwan faces challenges, experts suggest that it should not be viewed as competing with international travel but rather as a complementary option. Chen Yung-hsiang, a representative from the Travel Quality Assurance Association, emphasized that domestic trips are typically shorter, more flexible, and involve simpler logistics. This makes them a lower-risk option for one- to three-day trips, offering flexibility for those who may not have the time or resources for longer international vacations.

Domestic tourism remains a vital part of Taiwan’s tourism landscape, especially for those seeking quick getaways without the complexities of long-haul flights. As international travel becomes more accessible, Taiwanese residents are increasingly balancing domestic trips with international vacations, with day tours and weekend breaks providing a convenient option for those who wish to explore the island’s natural beauty and cultural landmarks.

Economic Pressures on the Domestic Travel Sector

The price hikes for domestic tours are a direct result of rising costs within the industry, including fuel prices, accommodation fees, and labor costs, which have put pressure on both travel agencies and tourists. The high cost of accommodation in popular destinations has also been a factor driving many domestic tourists to seek more affordable international alternatives, especially in Southeast Asia.

Additionally, the increasing popularity of affordable international destinations—such as the Philippines, Thailand, and Vietnam—has shifted travel patterns, as these countries offer competitive pricing for accommodation and activities. In contrast, Taiwan’s higher living costs and the price inflation of tourism services are pushing some potential tourists to reconsider staying within the island for their holidays.

Diversification of Domestic Tourism Products Needed

To remain competitive, the Taiwanese tourism industry will need to rethink its approach to product development. The rise in prices calls for the development of new offerings that focus on sustainable tourism and experiential travel, drawing attention to the island’s natural beauty, local heritage, and authentic experiences. Expanding beyond the traditional attractions of Taipei and Taroko Gorge, Taiwan’s tourism sector should look to smaller towns, rural areas, and emerging destinations to appeal to travelers looking for authentic, off-the-beaten-path experiences.

Domestic Tourism Strategies for Growth

To counteract the pressures on domestic tourism, it is essential for the Taiwanese government and tourism stakeholders to implement strategies that will make domestic tourism more attractive and competitive. Some key areas of focus could include:

1. Reducing Accommodation Costs: By working with the private sector to introduce affordable options, particularly for weekend stays and family-friendly accommodations, the government could help lower the barriers to entry for domestic travelers.
2. Targeting New Segments of the Market: Developing tailored travel experiences for niche groups, such as young travelers, wellness tourists, and cultural explorers, could draw in new segments that might otherwise prioritize international travel.
3. Enhancing Off-Season Travel: Encouraging travel during off-peak times with special offers and promotions could help reduce the concentration of tourism during weekends and holidays, balancing the flow of visitors and reducing overcrowding at popular spots.

Navigating the Future of Taiwanese Tourism

The challenges facing domestic tourism in Taiwan reflect broader global trends in the changing travel world, as increased options for overseas travel, coupled with costs, remake tourism demand. High exchange rates and resultant increased costs in Taiwan are part of the decline in domestic tourism, but the sector still represents tremendous opportunity. Redefining what tourism means, embracing sustainability, and improving local experiences will allow Taiwan to build a resilient, diverse tourism industry that suits locals’ and visitors’ needs alike.

In the long run, there is the need for Taiwan to adjust to the emerging trends in the tourism industry through the development of innovative tourism products, reasonably priced tourism packages, and mutually beneficial tourism projects. If all goes well, Taiwan should realize a renaissance in its domestic tourism, enabling residents and visitors alike to experience the diverse natural and cultural beauty of the island and put the sector on the path of long-term growth and global competitiveness.