The tourism sector can primarily reduce income inequality through the creation of new job opportunities. However, the redistributive effect of tourism may favor the rich, thus leading to further economic inequality.

Tourism impacts inequality through a phenomenon known as "economic leakage," where the majority of tourist spending leaves the local community and flows to international hotel chains, airlines, and foreign tour operators. In many developing nations, tourism can exacerbate the gap between the wealthy and the poor; luxury resorts often sit adjacent to impoverished areas, utilizing local land and water resources while providing only low-wage, seasonal labor for the residents. Furthermore, tourism can drive up the local cost of living, making housing and food unaffordable for locals as prices are adjusted for "tourist pockets." However, when managed through community-based tourism or "pro-poor" tourism initiatives, it can reduce inequality by creating direct entrepreneurial opportunities for locals. In 2026, many destinations are implementing "regenerative" models that tax tourists to fund local social infrastructure, attempting to ensure the benefits of travel are more equitably distributed.