Business Weekly / Are National Park Fees a Rip-off?

By Yang Shaoqiang

The Ministry of the Interior plans to charge fees for national parks, and some criticize this as "skinng" people for money. However, as long as national parks exist, the public will inevitably be "skinned"—the only difference is that charging fees allows people to freely choose whether they want to be "skinned."

First, as long as national parks exist, the public must pay in one way or another. The only difference is that without fees, people pay through taxes, and if they don’t pay taxes, they must pay directly. Therefore, the question boils down to: which payment method gives people more choice?

If funded through taxation, the government must collect more in taxes than the operating costs of the national parks, because tax authorities also incur operational costs—this is a transaction cost. With direct payment, people no longer bear this transaction cost, so the amount they pay would be lower than under taxation.

Moreover, after people directly pay for national parks, the government will no longer use tax revenue to provide them but will instead offer other products and services—for example, baseball stadiums. In other words, although people directly pay for national parks, they no longer have to directly pay for baseball stadiums. The products and services provided by the government shift from national parks to baseball stadiums. This may not necessarily be better for the public, but it also can’t be said that they are worse off because of it.

But if we consider that every dollar the government spends ultimately translates into the public’s tax burden, then when people directly pay for national parks and the government no longer provides other products or services, reduced government spending means lower taxes for the public. They can then use this untaxed income to freely choose between national parks and other services. With a wider range of choices, in this scenario, directly paying for national parks is definitely better than taxation.

Additionally, direct payment is voluntary: those who want to visit national parks pay, and those who don’t, don’t. But with taxation, everyone has to pay regardless of whether they want to go, resulting in those who don’t visit national parks subsidizing those who do.

Finally, direct payment requires setting a price for national parks. Once a price is set, national parks become a market-tradable service, meaning this service must compete with other market services. Should people spend two hundred dollars on a movie or two hundred dollars visiting a national park? The marginal value of national parks to the public can thus be reflected through market prices. Operators of national parks—whether government or private institutions—must strive to provide quality that matches their pricing; otherwise, consumers won’t visit. In the end, what people spend on national parks will align with the quality of service they receive, and the amount they pay will definitely be optimal.

However, with taxation, the marginal value of national parks to the public cannot be reflected through people’s willingness to pay or through competition with other products and services in the market. As a result, people either spend too much or too little on national parks, leading to societal losses.

Supporting national parks through taxation often hides the cost within various administrative processes—that’s the easiest way for the government to "skin" people. But if people directly pay for national parks, the cost is laid bare in the sunlight. Only by turning these hidden costs into transparent ones is it the best way to avoid being "skinned."

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