Last year 10.5% of all absences were down to holidays not agreed by schools - compared with 1.3% in 2011-12.
Welsh schools can authorise up to 10 days of absences per pupil, per year.
The Welsh Government said it was reviewing Welsh councils' use of fines to punish parents who break the rules.
Last year, then education minister Huw Lewis wrote to councils to say it was wrong to tell head teachers to ban all term-time leave after thousands of parents signed a petition against the Â£60 penalties.
The number of children aged between five and 11 being removed from class for term-time holidays, without permission, has risen every year since records detailing them began in 2011-12.
The number of half day sessions missed due to unauthorised holiday absences rose from 58,089 in 2011-12 to 424,760 in 2015-16.
However, because the number of authorised holidays has fallen over the same period, the total number of holiday absences has fallen from 920,500 to 788,841.
Mark Biltcliffe, head teacher of Drury Primary School in Flintshire and president of the National Association of Head Teachers in Wales, called for government-regulated tax incentives to discourage holiday companies from hiking up prices outside of term time.
"If people have got two or three children it is extremely expensive to go away on holiday, I think that needs looking at.
"There should be pressure on the holiday industry so they can't make these huge profits."
He told Good Morning Wales parents often asked for worksheets so children could keep up with what they are missing, but it was "not the same".
"Children do need to be in school every day and if they are not there then they're missing out on the teaching output and mixing with their friends
"It's about continuity and the input of the lesson, it's not the same doing worksheets on a beach in Spain."
In 2011-12, unauthorised holidays accounted for 1.3% of all absences, this increased to 10.5% in 2015-16, according to Welsh Government statistics.
During the same period, authorised holidays by primary school children in term-time decreased, from 19.3% in 2011-12 to 9% in 2015-16.
The percentage of secondary school pupils being taken out of class for holidays, without permission, increased from 0.8% to 3.6% in the same period.
Professor Ken Reid, former chairman of the Welsh Government's national review into behaviour and attendance, said missing 10 days of school every year would equal nearly a year's worth of work by the end of their school career - which he called "unacceptable" and "dangerous".
A Welsh Government spokesman said overall attendance figures were improving, with the number of secondary school pupils in Wales classed as "persistent absentees" - those who miss the equivalent of five weeks off - at an all time low in 2015-16.
He said: "Despite this progress, we can't afford to be complacent and will continue to act to improve attendance in all of our schools.
"Fixed penalty notices can be issued to address regular non-attendance at school and local authorities should have robust evidence before issuing a penalty."
Gareth Evans, director of education policy at the University of South Wales Trinity St Davids, said while improvements in overall absences were an encouraging sign, more needed to be done to stop children missing class.
He said: "Clearly the statistics are proof we are moving in the right direction, but while any one child is absent for a length of time there is still work to be done."

The contaminated meat was discovered by a dog walker on the Cuckoo Trail in Hailsham on Wednesday.
The sausages, which had been sliced open and filled with the blue pellets, were handed in to police.
The RSPCA warned that dogs ingesting even small amounts of some substances could suffer kidney failure and die.
A spokesman said: "The RSPCA is deeply concerned about any spate of suspected poisonings, but especially one where evidence suggests it may be deliberate.
"Animals, and especially dogs, are often extremely curious and will be drawn to food.
"If anyone suspects that their dog has been poisoned they must take it to a vet immediately. If possible, they should take a sample of what the dog has eaten."
Poisoning is a criminal offence in the UK under the Animal Welfare Act 2006.
The maximum penalty for those found guilty is up to six months imprisonment and/or a fine of up to Â£20,000.
The percentage of primary school pupils going on unauthorised holidays during term-time has reached a record high, official figures have shown.
[NEXT_CONCEPT]
Cocktail sausages believed to have been stuffed with toxic slug pellets have been found at a popular dog-walking spot in East Sussex.