Is my hotel in Rome allowed to keep my passport?
Though it rarely happens to tourists, police have the right to randomly stop you in the street and ask for an identification. If you do not have anything on you they can take you to the station and make you wait until you can get somebody to bring your passport from the hotel or B&B you are staying at. It rarely happens, but when it happens, you lose a lot of time and you probably don’t have a lot of time because there is much to see in Rome and your holidays are only that long.
If you are black, or colored, or Afro-American or whatever the PC word of the moment is, or if you look Arabic or Eastern European you have a bigger chance of being stopped. It’s police stereotyping and it’s not nice, but it’s reality, so you had better have your passports with you.
An argument against carrying your valuable documents with you is that you might get pickpocketed, so have your document in a moneybelt and have that moneybelt hidden underneath your clothes. It is best to have some photocopies of your document in your hotel room, in case something gets stolen. You could also scan your document and mail it as an attachment to yourself. (This also goes for your credit card, but make sure you use a secure mail address).