The tourism levy returned to the agenda earlier this month when the recently-elected Labour and SNP administration outlined plans in its coalition agreement to consult on the “viability and legality of a transient visitor levy”.
It comes after proposals for a tourist tax, backed by the council last December, were dealt a blow by the Scottish Government, which said local authorities did not have the necessary powers to implement such a levy.
The council’s decision to revisit the bed tax proposal has been slammed by Edinburgh Hotels Association.
“The hotel industry is already double-taxed because we are taxed on the physical property and on the financial performance,” EHA chairman Colin Paton told SLTN.
“If this came in it would be a third tax.
“If it still stands that the council does not have the powers to implement a tax, I am intrigued that they seem to wish to embark on another consultation exercise and waste public money. If Edinburgh is so adamant about this it must make everyone very concerned about their financial position.”
The move was also criticised by accountancy firm PKF, whose latest hotel figures showed an 8.9% slump in Edinburgh hotel revenues in March.
PKF’s Alastair Rae said the capital’s hotel sector is “fragile”. “A further charge on tourism in Edinburgh is, at best, ill-considered and, at worst, potentially harmful to the future of the sector,” he said.
A spokeswoman for the Scottish Government said it had not been approached by the council regarding a hotel tax. “We do not and will not have plans to legislate for such a tax,” she said.
Council leader Andrew Burns said there had ben “uncertainty surrounding the legal position” of a levy when it was previously mooted. “What is important now is to consider all the options – both from a legal and viability point of view – which is why we have pledged to consult further,” he said.