John McLellan: Fag-packet figures are no basis for tourist tax

Not one ministerial slap-down for council leader Adam McVey and the tourist tax, but two. Last week it was Scottish Finance Secretary Derek Mackay's turn to make it clear Edinburgh Council hasn't done the work needed to bring in the new levy.

Thursday, 13th September 2018, 7:00 am
The plans for a transient visitor levy in Edinburgh are short on convincing detail. Picture: Ian Georgeson

Echoing Culture and Tourism Secretary Fiona Hyslop’s rebuke of Cllr McVey in July, Mr Mackay used a written Parliamentary answer to remind the SNP in Edinburgh that they “will not consider requests to implement a tourist tax unless the tourism and hospitality industry is involved from the outset and its long-term interests are fully recognised.”

Mr Mackay went further, revealing that Ms Hyslop had met the Scottish Tourism Alliance the very same day which told her the council had not approached them “in any substantive way to consider the probable longer-term impact of a tourist tax on Scotland’s visitor economy.” Surely this was also known to Labour’s council group leader Cammy Day and ex-Scottish leader Kezia Dugdale when they both weighed in this week to insist the so-called transient visitor levy should be introduced, given the question to Mr Mackay was from Labour MSP Monica Lennon.

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Despite last week’s answer, on Monday Cllr Day said the results of a summer research programme would be part of what he called “a robust, industry-supported case”, when thanks to Mr Mackay and Ms Hyslop we know the STA’s position has not changed since its July statement which welcomed the SNP’s pledge not to give councils the power to bring in the tax without the industry’s full involvement.

The STA insisted that “Any change to this [Scottish Government] position should only be considered in the light of an objective and well-informed national, rather than local debate, following conduct of independent research, undertaken by a suitably experienced firm . . . and formal stakeholder consultation initiated by the Scottish Government.”

Yet today the council administration has leaked out details of the research, presumably to give Cllr McVey something to talk about when he goes in to bat for the TVL at the culture and tourism committee. But the council’s research fails on two counts; that the work has been conducted by a clearly partial organisation and has been done only on a local basis. Nor is there any sign the Scottish Government is about to launch the formal consultation the STA demands.

With the Scottish Government remaining under pressure on stubbornly low levels of economic growth, the STA’s arguments are likely to cut through; that the UK’s 20 per cent VAT rate is the second highest in Europe, that the UK as a whole is second bottom in the World Economic Forum’s measurement of international tourism price competitiveness, and that favourable exchange rates make no difference to the 60 per cent of visitors to Scotland who come from the rest of the UK and are already squeezed.

“Any new tax on tourists or the businesses serving them could ultimately have a potentially devastating long-term impact on Scotland’s tourism industry and local economies which could lead to potential job losses,” the STA argues.

All that has happened so far are back-of a-fag packet figures of £2.5m from Festival visitors coughing up an extra £2 a night, or £11m from a £1 charge all year round, being dangled before voters’ eyes without any indication of how it would operate.

Meanwhile Ms Dugdale smelt a Green-coloured rat, suggesting a cunning plan in which the Green Party has a secret deal to make the tourist tax their price for supporting the SNP’s budget. Maybe conversations have taken place – it’s the kind of nonsense that smarty-pants special advisers cook up – but if true it’s so cunning that minsters are humiliating Cllr McVey so as not to blow their cover.

So let’s stick with what we know: no scheme, no meaningful consultation, and no support where it matters for Cllr McVey.