Depends on how much they use the toilet and the amount of water they pump through after each flush (one use takes between 3-5l of water). If used for just overnight and not used for solids then it might be OK. Whether you reduce holding tank capacity to increase storage depends on your priorities, but if I had 8 people on board regularly and anchoring overnight then I would want maximum holding tank capacity. On the other hand if spending nights moored up at a quay or marina and using shoreside facilities then usage is less -, perhaps just for daytime stops and liquid only. How about monitoring your usage with the existing tank to see how often you fill it. Just as a rule of thumb, a 60l tank such as now fitted to new boats (and probably the capacity of your current tank) is considered adequate for a couple for up to 3 days.
Your current tank is a gravity tank, the simplest and least trouble to use. Why make it more complicated? The only thing you need to do is shut the outlet seacock when you want to use it as a holding tank and open it at sea to empty it.
