Wales to consult on ‘unfair and commercially restrictive’ tourism tax this autumn

The Welsh government has confirmed a consultation on proposals for a local visitor levy will launch in autumn 2022.

Rebecca Evans, minister for finance and local government, said the levy would be “proportionate” and powers to raise it would be discretionary for local authorities.

Evans said: “Visitor levies are a common feature in tourist destinations internationally. They are an opportunity for visitors to make an investment in local infrastructure and services, which in turn make tourism a success. Without such a levy, local communities face an undue burden to fund local services and provisions on which tourists rely. From keeping the beaches and pavements clean, through to maintaining local parks, toilets and footpaths – the critical infrastructure that supports tourism should be supported by all those that rely on it."

However, Dave Chapman, executive director for UKHospitality Cymru, described the measure as "fundamentally unfair" and "commercially restrictive". He said a tourist tax would extend the imbalance and drive customers towards the unregulated accommodation sector.

He said: “In the countries that impose a tourist tax of this nature, there are much lower levels of VAT on accommodation. The clear and unambiguous message from our members is that retaining the current 12.5% VAT rate for hospitality and tourism, in tandem with eliminating the inequalities of the business rates system is the key to sectoral recovery.”

Designated member Cefin Campbell said: “Giving local people the power to introduce a tourism levy will make a difference to communities across the country, many of which attract a significant number of tourists. It will give local people and their representatives more power and resources to invest and deliver in their areas."

Scotland was also consulting on proposals for a visitor levy, however the plans were put on hold due to the outbreak of Covid-19.

Photo: Shutterstock