The City of Edinburgh Council has voted in favour of controversial plans to introduce a tourist tax today.
The city council will not be able to impose the tax without legislation from the Scottish government, but today’s vote will see a final proposal developed and forwarded to the national legislator.
Despite previously talking down the introduction of legislation, the Scottish government included the introduction of a tourist tax in its annual budget last week, just days after consulting the industry on the controversial scheme.
Edinburgh’s plans, if passed, would add a flat £2 per night room charge, capped at seven consecutive nights. The Scottish capital would become the first local authority in the UK to introduce such a scheme, if the council gets the power.
The Transient Visitor Levy (TVL) was agreed as part of a deal to get the budget passed between the ruling Scottish Nationalists and Green MSPs, along with a number of other tax reforms including increased parking fees and council tax.
A second consultation on the introduction of the scheme has since been announced.
Willie Macleod, UK Hospitality’s executive director for Scotland, said: “We are extremely disappointed today that the City of Edinburgh Council has voted in favour of a tourist tax.
“During the debate, Cllr [Adam] McVey stated that consultation was a critical part of their process. Our members in the city would disagree, they do not support the introduction of a tourist tax and their opinions have been ignored.
“It has been suggested that a tax will raise up to £14m, but economic impact modelling shows that it would cost the city £94m, making it the highest-taxed city to visit in Europe. In these days of austerity, it seems bizarre that councillors would jeopardise losing millions of pounds of potential revenue from not only international visitors but also ‘staycationers’ from Scotland and the rest of the UK.
“Furthermore, the City of Edinburgh Council vote comes despite no legislation having yet been passed by the Scottish Parliament and the Scottish government has yet to initiate its promised consultation on any such legislation.”
Council Leader Adam McVey, said: “A TVL is the right choice for a historic, world-famous festival city like Edinburgh and our proposals have cross-council and citywide support.
“Edinburgh warmly welcomes over 4.5 million visitors annually which brings huge benefits but, the reality is, this footfall also has an impact on our streets and on our services.
“Under a TVL, visitors will be able to directly contribute towards these impacts so that together we can sustain Edinburgh’s appeal and vibrancy for the future benefit of all of our visitors and residents. My expectation is that this will be a tax which is set locally, collected locally and spent locally.”
Deputy leader Cammy Day added: “Our residents and businesses have told us they support a TVL for the capital and we are one of the very few cities in Europe not to have one – it’s time for Edinburgh to show the rest of the UK how it’s done.”