Tourist tax will cost '˜no more than a cup of coffee' says council leader

The tourist tax in Edinburgh will cost no more than a cup of coffee

The proposed levy would apply all year round but would be capped at seven nights so those visiting the Capital for longer would not be penalised, he said.

More details of the planned tax are due to be presented to councillors next month.

But nothing can happen until the Scottish Government agrees to give councils the power to introduce the tax.

Putting the case to Holyrood’s culture and tourism committee, Cllr McVey said the tax would help meet the extra costs Edinburgh faced from tourism. “This is a way of finding additional revenue to sustain what is a huge and crucial part of Edinburgh’s economy.”

He said the tax could raise around £11m a year for the city.

SNP MSP Annabelle Ewing cited a letter to the committee from the Scottish Tourism Alliance (STA) and UK Hospitality, claiming local authorities had “failed meaningfully to consult with the industry on their proposals”.

But Cllr McVey said STA members had attended round-table discussions on the issue and an STA representative had been at a briefing just the previous day.

Tory MSP Jamie Greene said the Federation of Small Businesses had said three quarters of its members felt a tourist tax would have a negative impact and the Culture and Tourism Secretary had warned against “hammering” the industry.

He asked: “If the industry isn’t in favour, if small businesses that it will affect aren’t in favour of it and it sounds like even the government itself are not supportive, do you feel you’re fighting a losing battle?”

But Cllr McVey insisted there was no industry consensus on the issue. He said Virgin Hotels, Airbnb and others backed a tax.

“There are industry voices who understand the impact this could make in supporting the sector.

“The industry behind closed doors, especially one-on-one with individual businesses, are taking a very different approach to the less than measured contribution by some of the industry bodies you will hear.”

SNP MSP Kenneth Gibson suggested revenue from the tax could be pooled so all councils shared in the benefits, but Gail Macgregor from umbrella body Cosla, who was also giving evidence, said Edinburgh faced “immense” pressures from tourism which councils like Borders did not.

Mr Gibson asked if the tax might be seasonal. Cllr McVey said: “The industry very clearly said they wanted it to be as simple as possible to apply all year round.”

Other MSPs asked about trying to get day visitors and camper vans to pay a charge.

But Cllr McVey said: “There will be 101 reasons thrown into this debate as reasons why unless it’s squared of we shouldn’t proceed.”

He said the focus for now should be on a small charge per for accommodation. “That gives us a platform and if we want to build on that in five or ten years time that’s fine.”