UKHospitality warns against tourist tax

UKHospitality has reiterated its message that a tourist tax in Edinburgh, or any part of the UK, could be disastrous for hotels and the hospitality sector, the UK’s 3rd largest private sector employer.

The assertion follows comments by City of Edinburgh Council leader Adam McVey’s announcement on Twitter that a tax would be introduced in the city “in the next 12 months”.

UKHospitality Chief Executive Kate Nicholls said: “The introduction of another tax aimed at hardworking, innovative and economically and socially important hotels in Edinburgh could be potentially disastrous knock-on impact on businesses.

“Adam McVey has rather blithely announced on social media that a tourist tax would be introduced in the city within 12 months; yet there has been no meaningful consultation with the businesses at risk and no wider discussion with the national organisations representing the hospitality and tourism sector.

“Hotels and hospitality businesses are already facing a mountain of costs and any additional tax, no matter the cost, would present vital employers with a significant barrier to growth an investment. The UK is one of only three EU countries which does not have a reduced rate of VAT on hotel and tourism services – by comparison, the rate of VAT on hotel rooms in EU countries is about half of the 20% rate applied in the UK.  In the majority of EU countries which have some form of tourist tax, there is a reduced rate of tourism VAT.

“The Scottish Government is rightly of the opinion that any such tax would be harmful to businesses in the country and we welcome Tourism Minister Fiona Hyslop’s assertion that no measure should or could be introduced without agreement from the Government and discussions with the hotel sector.

“UKHospitality and its predecessors the ALMR and BHA have consistently opposed the introduction of any tourist taxes in the UK and today the UKHospitality Board met in London to confirm its ongoing opposition to such a costly and potentially destructive measure.

“No tourist tax, in any part of Scotland or the rest of the UK, should even be considered without the full involvement of the hospitality sector. A full and wide-ranging consultation must first be carried out, in order to gauge the appetite of the sector and for policy-makers to identify the pros and cons of such a measure.”

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