Airbnb and new Virgin Hotel back Edinburgh tourist tax

SUPPORT for a tourist tax is growing, council chiefs claimed today as Airbnb and Virgin Hotels both said they were happy to operate such a levy.
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Council leader Adam McVey said: “We have had significant engagement with the industry on the detail about how it would be levied. I’m finding quite a lot of support within the industry based in Edinburgh 
for it.”

Short-term accommodation site Airbnb said it already had agreements with more than 400 governments and local authorities around the world to collect and remit tourist tax.

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“Hosts using Airbnb want to pay their fair share of tax and we want to help. So far we’ve collected and remitted over $700 million in cities around the world and should Edinburgh wish to introduce a tourist tax, we’ll gladly support that.”

Edinburgh could be set for a tourist tax.Edinburgh could be set for a tourist tax.
Edinburgh could be set for a tourist tax.

Virgin founder Sir Richard Branson was sceptical about a tourist tax when he visited Edinburgh earlier this year, suggesting it could drive visitors to go to Glasgow instead.

But in a message to the council, Virgin Hotels chief executive Raul Leal set out the company’s official stance: “Virgin Hotels is an international brand and we are well used to local tax arrangements and in Chicago we operate perfectly well with a local accommodation tax.

“If Edinburgh chooses to adopt this model we see no difficulties in operating in such an environment. Edinburgh is a vibrant and international city, and we want to be a strong partner in helping improve tourism for Edinburgh and Scotland.”

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Cllr McVey said there were other hotels also in favour. “I’m sure as we move forward those hotels will want to come forward and express their view.”

Adam Mcvey.Adam Mcvey.
Adam Mcvey.

Before it can introduce the new levy, the council needs to persuade the Scottish Government to give it the relevant powers and Cllr McVey was publicly slapped down by fellow SNP politician, the Culture Secretary Fiona Hyslop, when he tweeted about the issue recently.

But he said: “I’ve had very constructive engagement directly with the government on it. Their position has not changed – they legitimately are saying they have no plans to implement a Transient Visitor Levy. We are making what will be a robust and professional approach to the government showing that the economics stack up, it is not going to adversely affect Edinburgh’s tourist offer, and that we can use that money to support our growing tourist economy.

“It will also highlight the support within the industry, the support in the population of Edinburgh, which I think is overwhelming, and the near political consensus in local government, which I think is going to carry a great deal of weight.”

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Cllr McVey said the tourist tax was fundamentally a matter of fairness. “It is entirely fair to expect tourists to contribute to the city maintenance, to cultural and tourist investments, and to marketing the city so that it remains globally attractive.”

Richard Branson's Virgin Hotel has backed the planRichard Branson's Virgin Hotel has backed the plan
Richard Branson's Virgin Hotel has backed the plan

The council has not yet spelled out exactly how the money raised would be used.

Cllr McVey said: “It won’t be used for things that are left field. It will be used for very specific elements of the city. I think supporting infrastructure is definitely something that will feature and also managing demands on the city particularly during the peak times like the festivals and Hogmanay.”

He said it was “unlikely” any of the money raised would go towards road repairs.

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“What is absolutely crucial is that on an annualised basis we have a mechanism to make sure the council is deciding what the money is spent on with the right level of engagement with key stakeholders including the industry themselves into what those priorities should be.

“Everyone has said it should not just go into the council coffers and disappear.”

And Cllr McVey dismissed fears that if a tax is introduced the city might not benefit from it because central funding would be reduced to take account of the extra income.

“I’m not concerned about that,” he said. “Edinburgh already has a number of income streams which are not part of the funding formula so I would not expect it to be part of that formula. I would expect it to be totally in addition.”