Strong support in Edinburgh for introduction of tourist tax

A new survey of Edinburgh residents by the city’s council has revealed that 42 per cent of respondents asked for the creation of a tourist tax, such as a levy on hotel guests visiting the capital.

The survey carried out by Edinburgh City Council’s Finance and Resources Committee had been seeking suggestions on improvements for living in the city and found a levy on hotel rooms to help pay for increased services such as street cleansing as the most commonly cited scheme.

Andrew Kerr, council chief executive and author of the report which is due to go before councillors later this week, said there was “significant spontaneous support” for the introduction of a tourist tax.

Mr Kerr stated: “Respondents observed that they had paid similar taxes during their stays in Europe and it was reasonable that visitors to Edinburgh did the same.

“To a lesser extent, calls for a tourist tax were about making tourists compensate Edinburgh residents for the inconvenience and disruption the

Adam McVey

y caused.”

Council leader, Cllr Adam McVey, said: “For the majority of residents, our festivals and tourism industry are part of what makes Edinburgh such a special place to live. The Capital attracts four million visitors each year who bring investment, diversity and energy to our city but they also bring a cost in terms of the impact on our core services.

“Clearly, in order to sustain the most successful hospitality sector per head in the world, we need to continue to invest in the areas that make the city a success story – and we know from this and previous surveys that the principle of a tourist tax enjoys broad support amongst residents as a means of contributing to this. We will shortly be in a position to share a business case in support of a levy, encouraging a clear, balanced debate with industry leaders before presenting our proposals to the Scottish Government thereafter.

“In parallel, we are taking a number of steps towards gaining a better understanding of the impact of tourism on our city. This includes setting up a cross-party working group to actively monitor and minimise the impact on citizens, particularly during our busier festival months, and working closely with industry groups and the Scottish Government with a view to tightening up regulation of short-term lets, such as Airbnb.”

Opponents to a city tax in the Scottish capital, including the Edinburgh Hotels Association, claim the model that works in Amsterdam where there are two “city tax” bands of four and six per cent per room is not compatible because of the current UK tax-raising structure which is already in place to raise money for services, and they challenge its legality.

Willie Macleod, executive director, BHA Scotland, said: “The British Hospitality Association and, indeed the Edinburgh Hotels Association, is resolutely opposed to the introduction of a tourist tax.

“This would be an additional tax on all consumers, including Scots wanting to holiday at home and business travellers – not just foreign visitors.

“A tourist tax would make the Scottish tourism industry even more uncompetitive – already saddled with a 20 per cent rate of VAT on tourism which is more than double that of our European competitors.

“It would simply be punitive to introduce any new charges on hospitality businesses and their customers whilst this competitive disparity exists.

“Local councillors should be supporting the campaign to reduce tourism VAT.”