Tourist tax: Hospitality providers urge councils to switch from percentage levy to flat rate as new Bill is published
Hospitality providers have urged councils planning a tourist tax to “seriously consider” switching from a percentage levy to a flat rate after the Scottish Government said it hoped legislation allowing the change would be passed before the election.
Publishing the Visitor Levy (Amendment) ( Scotland ) Bill, public finance minister Ivan McKee said it would give Scotland's councils "even more flexibility" in the way they operated a tourist tax.
As well as allowing councils to bring in a Visitor Levy as a flat-rate charge instead of as a percentage of accommodation costs, it would also allow councils to vary the levy for different areas, different times of year and for different types of accommodation.
Edinburgh is due to be the first council to introduce a tourist tax, with a 5 per cent charge scheduled to come into effect on July 24. And council leader Jane Meagher has said she is happy to stick to the percentage system.
But the Association of Scotland’s Self-Caterers (ASSC), welcomed the new Bill and urged local authorities to rethink their plans.
ASSC chief executive Fiona Campbell, who is also vice-chair of Scottish Tourism Alliance policy group, said: “Given that change is coming, the sector would encourage local authorities, including those who have already formally consulted on a percentage-based levy, to seriously consider opting for a simpler, more workable fixed amount charge, which will have a less damaging impact on the accommodation businesses that are the lifeblood of our local communities.”
She said the option of a flat-rate levy was a “pragmatic change” which the industry had pushed hard for.
“It also reflects a clear cross-party desire to ensure the visitor levy is fit for purpose, proportionate and workable in practice. We are heartened that the Scottish Government has listened to consistent, evidence-based concerns.”
The Bill also sets out to clarify how levies are applied to accommodation booked through a third party, such as travel agents, an issue which has been behind complaints from the sector about the percentage approach.
The Scottish Parliament is due to go into recess on March 26 and be dissolved on April 9 ahead of the election on May 7.
The Scottish Government said subject to the parliamentary timetable, it was hoped the Bill would be passed in the current session.
Public finance minister Ivan McKee said: "When we introduced the original visitor levy legislation, we wanted to empower councils to implement a scheme that was right for their areas and easy to understand for local businesses.
"We worked closely with councils and tourism bodies when the original legislation was considered and passed by Parliament.
"These new proposals will give councils even more flexibility and provide clarity to businesses.
"We want to ensure visitor levies are an effective option for councils who choose to introduce them to boost investment in local economies and services."