Going into 2026, travelers are in for a shock with resort fees, cleaning fees, service fees tourist taxes and more. But operators are walking into a margin crisis.
Across hotels to short-term rentals (STRs), distribution costs, software fees, payment charges and taxes are taking a bigger bite out of the same guest dollar. We’re seeing a cost squeeze that is structurally different from traditional inflation, and one much harder to control.
OTA commissions: when 15%-25% is just the starting point
Online travel agencies (OTAs) still bring in indispensable demand, but the commission burden, typically in the 15%-25% range, has gone steadily upward.
Airbnb was always an outlier, but even they have revamped their “host-light, guest-heavy” fee model. Whichever way these fees are presented, it doesn’t make the cost disappear; it just shifts it around.
The squeeze comes from an ever increasing cost creep: OTAs forcing prepayment through their systems and not allowing you to be the merchant of record, imposing policies on cancellations, deposits or refunds that are not always host-friendly, applying high commissions on labor-intensive services such as cleaning fees or forcing their collection via their system rather than letting you collect them directly from the guest.
Programs like preferred placements, visibility boosters, payment programs and “partner” tiers add onto distribution costs in exchange for algorithmic favor, but do not always deliver commensurate performance benefits.
PMS and “percentage of bookings” pricing: the quiet revenue share
Property management systems (PMSs) was supposed to bring cost predictability. Instead, a growing slice of the market is experimenting with revenue-linked pricing.
While many hotel PMSs still charge per room, some vacation rental and multi-channel management platforms now take 2%-5% of booking revenue as their fee. On paper, it aligns incentives. In practice, it adds cost to the same booking already hit by OTA commission.
Add on extra integrations—from dynamic pricing to messaging, owners’ management and housekeeping—which are often priced per listing, per integration or per user, operators end up with mounting hidden costs. An “all-in-one” monthly subscription model with transparent fees upfront can bring more predictability.
Payments: Blended rates, hidden markups and cross-border surprises
Hoteliers are currently paying between 0.7% and 3.5% in card processing fees. Underneath, payment providers often bundle interchange, scheme fees and their own markup into a single “blended” rate that’s harder to pull apart.
For operators selling to international guests, the cost of accepting payments could add up with cross-border and FX markups on non-domestic cards, extra fees for chargebacks, crippling minimum deposits or bundled insurance programs, and other platform-specific products that add their own margin on top of base processing.
Regulations and tourist taxes
At the same time, governments are increasingly looking at overnight stays as a tax base. According to the American Hotel and Lodging Association, in the U.S., lodging taxes are now a core revenue stream for states and cities.
Hotels alone are projected to generate about $26.4 billion in lodging taxes in 2024, within a total of $83.4 billion in federal, state and local taxes—and those figures are still rising. STRs are being pulled into the same net, with cities extending occupancy taxes and compliance requirements to Airbnb-style properties.
In the U.K., 2024 and 2025 marked a turning point. Scotland’s Visitor Levy Act, passed in 2024, gives councils the power to charge an overnight accommodation tax across hotels, B&Bs and self-catering properties; Edinburgh will apply a 5% per-night accommodation fee starting in July 2026, capped after five nights. Glasgow has a similar 5% levy approved for 2027. In England, the new government is exploring powers for mayors to introduce a “holiday tax” on hotel and STR stays, potentially adding another 5% on top of existing VAT and local taxes.
For U.K. hoteliers that already face 20% value-added tax on accommodation, an additional 5% city-level levy risks pushing effective tax rates to levels that are hard to absorb without rate increases. For vacation rentals, the administrative burden is heavier, especially for small, owner-managed portfolios.
What operators should do
In 2026, operators that want to protect margins need to treat fees and levies as a managed cost category.
1. The priority is to build a true cost-per-booking view
For each channel, calculate net revenue after all commissions, PMS/revenue-share fees, payment fees and taxes. Do this separately for hotels, rentals or other property types in each key geography.
Put simply, understand and stress-test your cost ratio: take your total spent with any critical supplier and express it as a percentage of your total booking revenues today, then see what happens to these costs if your revenue increases. Do supplier costs increase at the same speed, or do they start to stabilize or decrease as you scale
2. Rationalize your tech stack
List every system that charges per booking, per room, per listing or percentage of revenue. Get vendors to move from revenue share to flat, usage-based or per-room pricing where possible. And remember to factor in API development costs, integration costs, support, maintenance and service costs. Beware double-paying for overlapping capabilities, especially multiple channel managers or messaging layers.3
3. Interrogate your payment contract
Ask your payment processors to break out interchange, scheme fees and markup for your top card mix and markets. Compare blended vs interchange-plus pricing and model the difference at your actual transaction profile. In many cases, simply moving away from a heavily marked-up blended rate can claw back 20 to 30 basis points of cost.
4. Actively manage OTA dependence
Use OTAs for the “billboard effect” to generate demand or boost off-peak business. Invest in direct booking. Work on your story, your photos and review scores and keep control of guest communications at all times. This means ensuring search engine optimization, answer engine optimization, email, the timing of promotions, loyalty and repeat-stay strategies are top-notch. It gives operators some leverage when negotiating commission tiers and program participation.
Favor OTA channels that give you a choice as to who should be the merchant of record, allow you to communicate freely with your guests and allow you to advertise extra services or cleaning fees, without forcing you to collect these through their platform, at a high commission rate.
5. Plan for levies and speak up in the debate
In the U.S., U.K. and Europe, tourism taxes are political as much as economic. Work through trade bodies to shape how levies are implemented, how long they last and how funds are used. In parallel, model visitor levies into your 2026 rate strategy now, so you’re not scrambling when a city goes live. Choose a technology provider that is up-to-date on compliance requirements, automatically calculate, apply or recalculate local taxes, no matter how complex the rule.
6. Share the cost burden.
Most software providers offer volume discounts to property management companies to reflect their scale. Distribute your software costs across the owners of the properties you service, even without any markup, as this will instantly increase your margin. This is easy where owners are able to enjoy direct benefits, such as accessing the system to review their account, understand occupancy levels, co-edit welcome guides, discuss cleaning, repair or maintenance requirements or easily book the property for their own use or for friends and family.
7. Tell a value story, not a discount story
As total prices become more transparent, there will be a temptation to cut rates to “look cheaper” in search results. This is a race to the bottom. Instead, sharpen the value proposition into what guests get for the all-in price.
The hospitality industry lived through seasonality, financial downturn and pandemics. It is now living through platformization, where interconnected overlapping systems and platforms compete and share a strategic goal to become the central hub for a variety of activities.
And the cumulative drag of fees, software costs, endless API integrations, payment markups, increased regulatory pressures, data sharing and the proliferation of tourism taxes can be overwhelming.
More than ever, operators need to rationalize and simplify, measure the true beneficial impact of any platform, understand where every cent of a booking goes, and systematically push that money back toward their own profit and loss.
About the author...
Michele Fitzpatrick is the CEO of
Eviivo.