THE tourism industry had been struggling through one crisis after another, and when it was suggested that it might be time to introduce a tourist tax, it was shouted down.
The SNP reacted caustically to the proposal, arguing that many Scottish areas, especially rural ones, were heavily reliant on tourism, and that "any new financial burdens could tip many businesses over the edge". A Conservative MP accused those behind the suggestion - some Edinburgh South members of the Liberal Democrats - of "crass stupidity".
Scottish Government publish 'tourism tax' legislation
This was 2001, and the industry had suffered grievously from BSE, foot-and-mouth disease, and terrorism. Labour ministers in the then-Scottish Executive were quick to distance themselves from their LibDem coalition partners. The LibDems said that their leader Jim Wallace, the deputy First Minister, had no part in the idea and had not given it his blessing.
Despite the criticism, the basic idea - a tourism tax to be levied on bookings in hotels, guest houses and local bed and breakfast establishments, for the good of the community - has endured, and indeed flourished. Taxes on overnight tourist stays are now common across Europe and in other locations around the world.
Councils need 'radical change' and new funding deal amid strain
Currently, all but six 21 of the 27 EU member states charge occupancy taxes. Depending on where you are, the levy helps increase general revenues or is ring-fenced, in all or part, to finance specific projects.
France's long-standing “taxe de séjour”, which is added to visitors’ hotel bills, generally ranges from €0.20 to four Euros per person per night, with the receipts helping to maintain tourism infrastructure. Visitors to Japan pay a 1,000 yen departure tax for much the same reason. As of last year the rate in Amsterdam for the city tax is seven per cent of the accommodation costs + three Euros per person per night.
Bologna charges €4 a night. Valencia is to introduce a tourist tax by the beginning of next year. Manchester, with notable support from from the city’s hoteliers, now requires visitors staying in a Manchester city centre hotel or holiday apartment to pay a £1 per night City Visitor Charge. The resulting £3m in annual revenue will aid tourism-related and cultural projects.
Edinburgh has previously mooted a £2 per night tourist levy, which could raise £15 million annually. The city will now amend those plans in the light of the new legislation.
The idea that was ridiculed in 2001 has now come full circle.
Appeal for SNP to speed up tourist tax plans for councils
Scotland's Public Finance Minister, Tom Arthur, launching the Visitor Levy (Scotland) Bill this week, said that giving councils the power to introduce a visitor levy will help provide additional resources to continue to attract visitors to Scotland.
Levies on visitors staying in paid-for accommodation are already used around the world, Mr Arthur added, and it was reasonable for local areas to want a small contribution from tourists to help support and sustain visitor economies.
If backed by MSPs, local authorities, after putting the matter out for consultation, will be able to add a charge on all overnight accommodation, based on a percentage of the total costs.
COSLA, which speaks for local authorities, has been delighted by publication of the Bill, describing a positive chance for partnership working between local government and Scottish Government, and certainly empowering local authorities in giving that discretion is absolutely welcomed.
Not everyone is happy with the idea of a tourist levy. An Inverness hotelier, fearing that the hospitality industry is already facing enough challenges, fears that the levy could be the last straw. The Association of Scotland’s Self-Caterers worries that the new charge might add more risk and uncertainty to the sector.
Some critics say there is a danger that Scotland might become uncompetitive compared to its neighbours.
The Scottish Tourism Alliance, however, makes the sensible point, saying that the visitor levy has to be viewed as a source for good, rather than being labelled as an "extremely damaging" tourism tax.
It's difficult not to have sympathy with such views. As we have often noted, the hospitality industry has had no shortage of problems to contend with in recent years.
But the new levy, if implemented, will in time give valuable extra income to local authorities which have also been feeling the pinch. Other countries and regions have launched such levies without causing too much damage. The widespread observation that the new charge will amount to no more than the price of a cup of coffee seems to have held good.
Scott Wright: Dark clouds still hang over hospitality industry
VisitScotland's Chief Executive, Malcolm Roughead, yesterday responded enthusiastically to the release of the International Passenger Survey tourism statistics for 2022 by the UK Office for National Statistics. To him, the return of international visitors marks a significant milestone in the recovery of Scotland’s valuable tourism and events industry. Such visitors, he added, stay longer and spend more, helping to support jobs and communities right across the country.
Scotland's tourism industry seems to be flourishing. In the scheme of things, given Scotland's enduring appeal to tourists, it is difficult to visualise a modest and easily-absorbed new levy having an adverse impact on that.
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