Edinburgh visitor levy scheme draft sparks mixed reactions
A draft scheme ahead of the Policy and Sustainability Committee meeting on 22 August proposes a visitor levy in Edinburgh, allowing accommodation providers to retain 2.5% of the proceeds to cover their costs. The visitor levy, a fee imposed on overnight stays, is intended to raise funds for local services and tourism-related projects. UKHospitality Scotland supports this measure, emphasising that it is vital to prevent the levy from hindering investment, economic growth and job creation in the sector.
The scheme also suggests a 5% levy, capped at seven consecutive nights, and recommends that half of the funds raised be allocated to culture, heritage, events and destination management. Hospitality representation on the visitor levy forum is also advised through the Edinburgh Hotels Association, a member of UKHospitality Scotland.
Leon Thompson, executive director of UKHospitality Scotland, expressed approval of these provisions, noting that allowing businesses to recoup 2.5% of proceeds would help mitigate the financial burden imposed by the levy. He stressed that the funds raised must enhance the visitor economy, not supplement routine council budgets.
“UKHospitality Scotland has been clear about the negative impact this scheme could have on hospitality and tourism, if done wrong, and the inclusion of cost recovery, ring-fencing and hospitality representation on the forum is a positive start. I hope the council takes forward these recommendations,” Thompson said.
The Visitor Levy Bill, passed by the Scottish Parliament on 28 June, sparked a lengthy debate on whether councils should have the power to introduce such a tax. The Bill enables Scottish councils to consider implementing a visitor levy, with the earliest possible introduction in 2026. Thompson welcomed the 18-month preparation period after a council decides to introduce the levy, allowing businesses and councils time to adequately prepare.
Meanwhile, the Scottish Licensed Trade Association (SLTA) voiced opposition to the visitor levy last month. Colin Wilkinson, managing director of the SLTA, criticised the government for not recognising the levy as a tax and expressed concerns that the additional revenue might not be used for its intended purpose. Wilkinson also pointed out that, unlike Scotland, other European countries with visitor levies do not charge 20% VAT on accommodation. He argued that the combination of the levy and VAT places Scotland at a competitive disadvantage, calling it a “tax on a tax.”
Wilkinson further emphasised the need for flexibility in the new legislation and for the licensed hospitality sector to be included in discussions with local councils.
Keywords:
Search
56-58 Church Walk, Burgess Hill, West Sussex, RH15 9AN
Registered in England No. 6646125. VAT No. 938 4452 95
