Should we really be looking at charging Tourist taxes?

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Should we really be looking at charging Tourist taxes?

The online Guardian Small Business Network reports that some Councils are considering charging tourists to stay in overnight accommodation. The full article can be found here .

Anyone travelling abroad will be familiar with the concept of daily hotel taxes or other local taxes being added to your bill, indeed there are even some airports I have travelled through that have charged extra on the basis that the taxes pay for improvements at the airport.

The cities The Guardian discusses are Bath, London and Edinburgh, but if these are successful we can be sure others will jump on the band wagon. The article quotes London mayor Sadiq Khan as calling for the tourist tax. They claim he wants to ensure that tourists who come to London contribute to the city. The proposed plan would add up to 5% extra to hotel bills (ex or inc VAT?)

Surely those who come to our cities as tourists and pay for accommodation are already contributing to the city? By visiting and staying in the cities and spending money they are supporting the local economy directly. This is not just in hotel fees but also by travelling on local transport, visiting attractions, shopping and, amongst many others, eating out. Many of those businesses rely upon tourists.

A further problem arises with UK residents who stay in those hotels. Will they have to pay the levy as tourists? What if you already live and work in the city concerned but are just staying overnight after an event – have you not in your council taxes already contributed to the city?

You can see numerous difficulties.

The Guardian mention the position of Airbnb, a way of finding accommodation which is proving ever more popular. You can see the need to identify and collect these charges from those who rent out their properties being fraught with problems.

The Hotel and Licensed sectors are trying to recover after a difficult period, the last thing they want is to start to pile more costs on their guests. They would also have yet more red tape and overheads in dealing with the accounting for these taxes. You do wonder after all the costs of recovery (at the councils and the hotels) are taken into account what revenue this will actually generate.

Is this really a good idea?

Peter Adkins

Peter is highly regarded for his specialism in Licensing and Gambling Law. The guide to the legal profession, The Legal 500, recognises Peter’s specialism in this area and he is regularly engaged by clients all over the country involved in all aspects of the Licensed trade. Peter deals with pubs, restaurants and hotels, social and members clubs, casinos, gambling establishments, shops and late night take-aways. Peter and the firm are able to look after all their legal needs.

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