A new report has revealed that the Scottish capital is facing an 80% reduction in available self-catering tourism accommodation as a result of new rule changes.
The City of Edinburgh said it expects eight out of ten self-catering firms to close in papers around a proposed visitor levy, or tourist tax, to be discussed today.
The estimate far outstrips industry fears. A recent survey of around 1,270 short-let businesses by the Association of Scotland’s Self-Caterers found around 60% of operators had yet to act on applying for a licence ahead of new legislation going live.
The report unveils its new tourist tax proposal and also reveals for the first time the extent of the impact it is expected to have on businesses.
READ MORE: Tourism industry leader's anger over licensing policy
The council report said estimates show that between £5.6 million and £37m could be raised annually from a 1% and 7% of room cost charge levy if applied to all hotels, self-catering apartments, bed and breakfast/guest houses, short-term lets and hostels in Edinburgh.
The measures are aimed at tackling issues such as the housing squeeze and to tackle the impact of the rise of unregulated Airbnb-style short-term letting accommodation.
Local authorities have been given the power to introduce short-term let control areas under the legislation passed by the Scottish Government.
However, industry insiders fear it will “decimate” the sector.
READ MORE: Anger over Humza Yousaf ‘disdain’ for Scottish tourism
The report reveals: "A conservative assumption has been applied to the potential cross over in accommodation lines and the future supply of the short-term let sector in Edinburgh.
"There are some cross over between self-catering apartment and serviced apartments, also between Airbnb properties and guesthouses. In addition to this there will be an impact from the new licencing and regulations decision locally to be applied from September 2023.
“To account for all of these together, an assumption of an 80% reduction from the Edinburgh 2021 number of active listings reported on Airbnb, as a proxy for the size of short terms lets."
READ MORE: New licence scheme 'will sink' Scottish self-catering industry
Louise Dickins, director of the ASSC, said: “Our worst fears have not only been realised, they have been exceeded.
“City of Edinburgh Council is happily pursuing an agenda that will close eight out of ten self-catering businesses and bed and breakfasts, decimating the tourism economy across the city and the country.
“Our industry is pro-regulation, but this legislation hasn’t been designed to regulate – it has been designed to destroy small businesses.
“Through its ill-conceived policy, the SNP/Green Government has relinquished control of a critical, multi-billion-pound industry to local authorities."
EXPLAINED IN FIVE MINUTES: Scotland versus the rise of Airbnb-style holiday homes
She also said: "With the bulk of inbound international tourism coming now through Edinburgh, one of Scotland’s largest local authorities now has the ability to tank the tourism economy for the entire country.
“The Scottish Government needs to step in and control this situation before irreparable damage is inflicted on the entire country.”
Cammy Day, council leader, said: “This is an estimate to make sure that we don’t over anticipate the level of income that can be generated from the visitor levy.
“As noted in the report the 80% reduction also takes account of the potential for double counting between listings that can appear on multiple registers.”
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel