As the controversy around the impending launch of the short-term let licensing regime reaches its fiery crescendo – with holiday let and B&B owners protesting outside the Scottish Parliament while MSPs gathered inside to argue the case – something else, less dramatic but maybe just as significant for the tourism industry, has been happening along in the committee corridors.

The clerks to the Local Government Committee have been gathering in the responses to the Visitor Levy (Scotland) Bill – the forthcoming legislation that will allow local authorities to introduce a “visitor levy” (formerly trading as the “tourist tax”) on overnight stays.

The more eagle-eyed observer will have noticed that there has been the odd issue of late around how the Scottish Government designs and implements new regulatory regimes – especially those which rely on private businesses for their administration. Indeed, this is why the current system of how the Scottish Government regulates business is being overhauled.

So, the pressure’s on to get this one right.

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The stakes are further raised by the industry’s importance to the economy – to the tune of £4.5bn a year and 200,000 jobs. Not to mention the fact that the wider issues the debate raises – from local infrastructure to the cost of living and affordability of holidaying in Scotland – are guaranteed to provoke strong passions on all sides.

As we said in our submission to the Committee, there’s a range of views across small businesses. Overall, just over half of those we surveyed earlier this year were opposed to a levy, rising to nearly seven in ten in the accommodation and food service sector.

So, there isn’t outright blanket opposition to the levy. But there are legitimate concerns and questions. And, in the discussions we’ve had with our members, some common themes emerge.

First, there’s the administration. Get this wrong and it will create further burdens for small accommodation providers – providers who are already grappling with everything from staff shortages, to spiralling costs, to, in some cases, the aforementioned short-term let licensing scheme.

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Whatever form a local levy takes, accommodation providers will have to identify the chargeable part of their overnight rates and apply the levy accordingly, before submitting a return and payment to the local authority. As the Government’s own impact assessment makes clear, 93% of registered enterprises in the accommodation sector are small. There are also many other providers who are not registered for VAT or PAYE – all of whom will, by definition, be at the micro end of the spectrum.

It’s therefore vital that councils introduce easy-to-use systems, designed around these small operators’ requirements, as opposed to what might suit a major hotel chain.

That said, straightforward systems are no use if the schemes they’re administering are complicated or ambiguous. Thus, the local levies themselves need to be simple and clear.

For example, the consultation asks whether the levy should be charged as a flat nightly fee or a percentage of a customer’s room rate. If a council was to go down the latter route, you can see why you’d need crystal clear rules to allow providers to isolate the specific room element on customers’ bills, distinguishing it from anything else included in the price, such as meals.

Similarly, any national exemptions – for example, for those staying in accommodation as refugees or fleeing domestic abuse – need clear working definitions that can be relied upon.

The other major issue is around how the revenue that any levies raise should be used. Our most recent survey shows that the majority of small businesses want to see funds invested in local infrastructure and facilities – from roads, to public toilets, to car parking – which will improve the overall environment, not just for tourists or tourism businesses, but for everyone.

Specific local priorities will vary, so the local business community needs to be meaningfully included in council decision-making on where levy revenue will be spent. This will be crucial in getting buy-in from the local tourism industry.

As is so often the case, the solution to many of the issues this consultation raises is to listen closely to small businesses at every stage. They are the heart of Scotland’s tourist industry and no-one knows their local market better – so any visitor levy schemes need to be designed around them.

Colin Borland is director of devolved nations for the Federation of Small Businesses