MSPs warned Edinburgh tourist tax is ‘discriminatory’

The head of a hospitality body has warned Holyrood that a tourist tax would be discriminatory. Picture: Ian Rutherford
The head of a hospitality body has warned Holyrood that a tourist tax would be discriminatory. Picture: Ian Rutherford
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Tourism industry leaders yesterday warned against the introduction of a tourist tax with a leading figure in the hospitality sector claiming it would be “discriminatory”.

William Macleod, Scotland executive director for trade organisation UK Hospitality, outlined his opposition to the tax when he appeared in front of a Holyrood committee.

Mr Macleod said his organisation’s research showed that a £2 per room, per night levy, as being proposed by Edinburgh City Council to raise an estimated £11 million annually, could result in a £175m economic hit if applied nationwide.

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Giving evidence to Holyrood’s Culture, Tourism, Europe and External Affairs Committee, he said: “You have staying visitors, you have day visitors, you have people staying with friends and relatives.

“Everybody makes a demand on local services but introducing a transient visitor levy, or a tourist tax, is putting a discriminatory tax on anyone who uses commercial accommodation. Where is the rest of the contribution coming from, from those who are not enabling businesses to meet their contribution of cost and contribution to local services?

“I think we have to look at cause and effect here.”

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He was joined by all members of the panel before the committee in welcoming a consultation on a tourist tax announced by the First Minister earlier this week, but he said in-depth analysis is needed. Marc Crothall, chief executive of the Scottish Tourism Alliance, echoed this view and warned that introducing the tax could push squeezed tourism businesses “over the cliff”.

He said: “The world’s a small place and Scotland is a very small place and we need to be competitive.”

But Peter Irvine, director of Unique Events which ran Edinburgh’s official Hogmanay celebrations for more than two decades, argued the city is an “exceptional case”.

He said when running the Hogmanay event he would wish accommodation providers would contribute to costs, saying the hotels went from being “empty” to having the highest rates over new year than any other European city.

“I would suggest Edinburgh should seriously look at it. The revenues of it… should improve not just the visitor experience but what it’s like to live with an influx of tourists,” he said.

“Tourism is not a tap that’s going to go off or be turned down. It’s going to increase.”

Tourism tax, also known as an occupancy or bed tax, is a levy that is usually charged per person, per night. It is on-top of the cost of a holiday, and is paid directly by guests to hotels, B&Bs, and campsites.

The rate typically varies by the standard of accommodation, location and local authority, and children often attract reduced rates or are exempt.

In addition to Edinburgh, Aberdeen City and Highland councils have expressed an interest in the levy.