New bed tax threat faces Edinburgh tourists

Councillors are due to discuss the introduction of a  bed tax. Picture: Lisa Ferguson
Councillors are due to discuss the introduction of a bed tax. Picture: Lisa Ferguson
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A FRESH drive has been launched to introduce a “bed tax” in the Capital.

City chiefs have attended two “material” meetings with Scottish Government officials, including one earlier this month, to discuss a “transient visitor levy”, which could result in an additional fee for every night’s stay in Edinburgh.

The plans may also extend charges to other tourism-focussed businesses, such as restaurants and bars.

And it is understood council leaders are assessing the possibility of restricting a levy to periods of peak demand, such as the summer and winter festivals.

Plans for a compulsory tax – which would have added between £1 and £2 per night to a room bill – were backed by the city council in 2011 and could have raised up to £10 million for ­festivals, venues and conference centres.

However, those proposals, which required new legislation from the Scottish Parliament, were later scrapped after receiving a “cool response” from ministers.

A voluntary levy was also ruled out late last year amid concern over reliability of income and whether enough firms would sign up.

Councillor Paul Edie, Liberal Democrat member for Corstorphine and Murrayfield, said: “I’m pleased to see some progress is at last being made. I don’t think a voluntary tax would work – we need to do it properly.

“You go to virtually any European city on holiday and you’ll pay a couple of quid extra for your stay – the price of a cappuccino. It’s hardly breaking the bank, it’s not the sort of thing that will deter you from visiting somewhere and it generates new investment in Edinburgh.”

However, Graham Birse, director of the Edinburgh Institute at Napier University, has warned city bosses to tread carefully.

He said: “Any scheme that narrows in on hotels exclusively would have to be voluntary. If you were introducing a compulsory levy, it would have to apply to other businesses too.”

Although the bed tax has been resisted in Scotland and the UK, it has been used around the world.

New York, Venice and Vancouver have introduced the charge on hotel stays.

Councillor Frank Ross, economy leader, said: “We have a very clear commitment to the city’s festivals and need to think innovatively about how we maintain this support.

“Talks about the workability of additional funding methods are ongoing. It’s important we share this challenge and explore a variety of options.”

A Scottish Government spokeswoman said: “The Scottish Government regularly meets local authorities to discuss matters of shared interest, including with City of Edinburgh Council.

“These talks can vary in scope and can include discussion of matters relating to tourism and other subjects relevant to our towns and cities.”