While Statistics Estonia recently found the total number of overnight stays in February were up by nearly 4 percent on year, restaurants still face the critical low season and at a time of ongoing rising prices. Over 20 eateries have recently closed for this reason, "Aktuaalne kaamera" reported.

2026 has not started very well for the Viiking Spa Hotel in Pärnu, in part due to its own developments and also after a stronger first quarter of 2025.

"The beginning of this year has been weaker for us than last year. But it depends on what you compare it with. Last year was very strong for us. At the start of this year, one of our accommodation buildings was practically out of service until the end of March, which overall reduced the number of our tourists in the first three months. But the biggest change was in the Finnish target market, which affected medical tourists," said Kairi Lusik, the hotel's CEO.

Külli Kraner, CEO of the Estonian Hotel and Restaurant Association, said a more important indicator than the number of nights stayed per visitor is hotel occupancy, and this still remains below 40 percent, she noted. Whereas in Tallinn occupancy went up by 7 percent after a reduction in average prices, in Pärnu occupancy has still fallen on year, and by 4.4 percent. Part of the issue is an ongoing fall in domestic tourism, Estonian citizens and residents staying in accommodation in their own country, as well as regional disparities. "In some regions, both occupancy and revenue per available room have even been up to four percent lower than last year," Kraner said.

In the accommodation and catering sector as a whole, restaurants have reached a critical stage in any case.

"With the VAT increase in the summer, VAT for restaurants also rose. As a consequence, when leaving restaurants in Estonia, we pay the second-highest VAT rate in the European Union. This has certainly had an impact on our businesses. We are seeing a trend toward unprofitability in the catering sector. For many companies, especially during the low season, the question right now is simply whether they can stay afloat," Kraner said.

Meanwhile, Taigo Lepik, head chef of the Pull and Härg restaurant in Tallinn, said that eateries had already started disappearing off the map in the second half of last year; up to now at least 20 eateries in the capital alone have closed, due to rising prices affecting both production and consumers.

Restaurant meals are more price-elastic than some other goods and services, he said. "Restaurants cannot raise prices, even though their partners are increasing theirs by 10 to 20 percent. If we upped prices by 20 percent every time costs increased, it simply wouldn't be sustainable. Input costs are rising across the board, starting with raw materials and energy, along with all related expenses. If we increased restaurant prices at the same pace, we would soon be sitting in an empty restaurant," Lepik said.

According to Statistics Estonia, the total number of overnight stays in February increased by 3.8 percent on year. Mobile positioning data found 3.42 million foreign visitors visited Tallinn in 2025. Growing inbound tourism significantly increases the need for accommodation capacity in Tallinn; the agency's report found that by 2040 an additional 1,400–2,200 rooms will be needed to serve the expected volume of overnight stays. At present, Tallinn has 9,801 hotel rooms.

VAT was increased from 22 percent to 24 percent in July 2025.

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