Smaller operators join bed tax fight

11 May 2006
Smaller operators join bed tax fight

Caterer‘s campaign against a bed tax continues to gather pace as small hotels, B&Bs and independent businesses around the country rally against the proposals.

Such small and medium-sized enterprises make up about 70% of the British tourism and hospitality industry and would be worst hit by the proposed tax.

Already under threat from the repercussions of cheap overseas flights and lower tax rates in other European countries, many small operators fear that a bed tax could be the last nail in the coffin for struggling businesses.

Stephen Joynes, director of Hoar Cross Hall Spa Resort in Staffordshire, said the proposal for a 5-10% tax on overnight accommodation was yet another example of "a back-door tax".

"This is another sad move against the country's hotel businesses," he said. "As a country, we don't actually manufacture much any more. We have moved over to being more of a service-orientated economy - something which is now being attacked. Putting further taxation on hotel businesses will only serve to put more pressure on the tourism industry as a whole."

Sophia Williams, general manager of Holdsworth House hotel in Halifax, agreed.

"This would be just another cost to small businesses," she said. "As a small hotel, we have many escalating costs already, and another tax will simply put more pressure on our room rates. It could also generally lead to a fall in standards, as small hotels are forced to cut staff."

Phil Gray, membership secretary of the Stratford-upon-Avon District Hospitality Association, said prices would have to go up if the tax were imposed. "Then there is also the worry of the possible price hikes at local pubs, restaurants and shops," he added. "We already have high taxes without the threat of bed tax and the ensuing price increases this will cause."

Managing director of the East of England Tourist Board, Tess Wright, branded the proposed bed tax "anti-competitive, counter-productive and unworkable".

She added: "If local areas are allowed to levy local taxes at differential rates, the UK marketplace could become artificially distorted. Local authorities should be concentrating on publicising tourism benefits to their council-tax payers rather than ‘stinging' the visitor because it seems the easier political option."

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For the more news on the bed tax click here >>

By Louise Durak

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