The so-called city tax, also referred to as bed tax, cultural tax ortourist tax, originates from the politician Norbert Walter-Borjans. Since 2009 this levy has gained more and more attention. Besides large cities such as Berlin, Hamburg and Cologne it is also charged in a growing number of smaller cities such as Weimar, Jena and Lubeck. The fees go into the households of their respective cities.
The bed tax is often charged based on the net rate of an accommodation, which is in most cases a surcharge of 5 %. In the city of Dortmund there are even 7,5 %being charged on top of the gross accommodation rates! Cities such as Bremen, Dresden or Eisenach ask for a flat rate rather than a percental levy, which depends on the size and facilities of guest houses and hotels. Apart from the different calculation models there also exist several possibilities to be exempt from the tax. For example business travellers are excluded from paying this fee.
If you would like to get a more in-depth overview of the exemptions of the city tax in German cities, please take a look at this website, where all German cities are listed with their respective tourist taxes including exceptions and special regulations.