TRADE groups have underlined their opposition to the introduction of a so-called tourist tax, saying Scotland’s need to be competitive as a visitor destination is “greater than ever” ahead of its exit from the EU.
The Scottish Tourism Alliance (STA) said UK tourism as a whole is already globally ranked 135th of 136 countries when it comes to price competitiveness due to “existing high levels of taxation”, and that any suggestion of applying a further tax on tourists could “seriously damage” Scotland’s appeal as a tourism destination. This was echoed by the British Hospitality Association (BHA) Scotland.
The groups reiterated their opposition to the measure as the City of Edinburgh Council said details of a proposed tourist levy for the capital are due to be tabled soon, while Glasgow City Council also floated the idea last week as part of its budget consultation. Local authorities do not currently have the power to introduce a tourist tax; legislation would be required to give them such powers.
Adam McVey, the SNP leader of the City of Edinburgh Council, said the authority will “shortly be in a position to share a business case in support of a levy” before presenting proposals to the Scottish Government.
McVey said the measure, which has been mooted by various Edinburgh council administrations down the years, is needed to invest in “core services” which are impacted on by the four million visitors to the capital each year.
“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 that the principle of a tourist tax enjoys broad support amongst residents as a means of contributing to this,” said McVey.
“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.”
However, the STA said “the strength of opposition to the principle of a tourism tax across Scotland’s hospitality and tourism industry is widespread”.
“The need for Scotland to remain – and, indeed, become more – competitive as a tourism destination is greater than ever in relation to our impending exit from the EU and the associated damage our tourism industry is likely to bear as a result,” said STA chief executive Marc Crothall. “Tourism in the UK is already globally ranked 135/136 when it comes to price competitiveness due to the existing high levels of taxation – 20% VAT, APD (air passenger duty), fuel tax; any suggested proposal to apply a further tax hike on tourists in what is an increasingly competitive global market has the potential to seriously damage Scotland’s appeal as a tourism destination.”
Willie Macleod, executive director for Scotland at the BHA, agreed, saying the hospitality industry is “steadfastly opposed” to the introduction of a levy.
“A tourist tax is not the answer while we have a 20% rate of VAT,” he said.
“To assume that putting a few pounds onto the cost of a hotel room is not going to impact is naive.”
A spokesman for the Scottish Government said: “We have been consistent in our stance that, given the potential impact on tourism, we have no plans to introduce a visitor levy on the tourism sector, which is already subject to the second highest VAT rate in Europe by the UK government.”