Firms face ‘tourism tax’ to boost Edinburgh appeal

Business leaders say companies must work together to increase the city's 3.75 million annual visitors. Picture: Cate Gillon

Business leaders say companies must work together to increase the city's 3.75 million annual visitors. Picture: Cate Gillon

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A “TOURISM tax” would see firms serving millions of visitors stump up thousands of pounds to boost the Capital’s status as a mecca for holidaymakers.

Funding has been ring-fenced to draw up plans for a city-wide tourism business improvement district (TBID).

Under the scheme, hotels and other companies which benefit from tourism would pay levies to fund improvements aimed at enhancing the city’s global appeal.

If established, the zone would exist alongside general business improvement districts in areas such as the city centre and Grassmarket.

The proposals come after council plans to charge hotel visitors a small levy for every night they spend in Edinburgh – the “bed tax” – were axed in 2012 amid a “cool response” from the Scottish Government.

Business leaders said discussion about the merits of a scheme which imposes levies on all firms benefiting from the city’s tourists was welcome and “worth pursuing”.

Graham Birse, director of the Edinburgh Institute of Leadership and Management Practice at Edinburgh Napier University, said: “I think that in the past the hotels felt they were bearing the cost, but if this involves all of the relevant component businesses within the industry – not just private but public sector as well – it’s worth moving ahead with the dialogue.”

It is understood any TBID would be business-led, 
meaning firms would decide on factors such as membership criteria, geographical reach and overall goals.

According to national tourism leaders, TBIDs can be used to promote specific destinations and business sectors, provide staff training, and manage joint booking and procurement.

The latest figures indicate Edinburgh receives around 3.75 million visitors annually, of which 2.3m are from the UK.

Mr Birse said the Capital was facing fierce competition from rival cities, and called on business and tourist organisations to work together.

“There’s an important role for the Edinburgh Business Forum and also the Edinburgh Tourism Action Group in representing the industry,” he said. “We need to recognise that other cities are significantly well resourced when it comes to promoting themselves and we need to match that.”

John Donnelly, chief executive of Marketing Edinburgh, which has secured the £20,000 funding package to draw up plans, said his agency was looking at a number of mechanisms which would help get “wider corporate Edinburgh” involved in promoting the city.

Councillor Frank Ross, economy leader, said he was working with all “relevant stakeholders” to boost private sector investment. He said: “This work is collaborative and voluntary – as a result, many and ever more businesses have responded to this call.”

johnpaul.holden@edinburghnews.com