The Government has ruled out implementation of a bed tax, just hours after the Lyons Inquiry into local government funding recommended a consultation on the proposal.
In its response to Sir Michael Lyons' report, which was released this morning, the Department for Communities and Local Government said there was no evidence to suggest a tourist tax would be viable.
Local Government Minister Phil Woolas said: "Sir Michael examines the case for a tourist tax. He concludes that there is not a strong evidence base for the introduction of such a tax.
"While he puts the case for a consultation on this issue, we are not, therefore, inclined to focus on this area. The Government does not intend to introduce a tourism tax."
Stuart Barrow, public affairs manager at tourist body VisitBritain, said: "We are absolutely delighted that the Government has rejected a new tourism tax.
"We had taken calls in North America from potential visitors who were worried about a new bed tax adding to their costs. Now we can categorically tell them that no bed tax will be imposed. This is great news for Britian's £85b visitor economy."
The move marks a success for Caterer's "Say No To Bed Tax" campaign, which garnered the support of a host of leading operators and industry bodies and saw us deliver a petition of more than 4,000 petitions to Lyons last summer. Read more at the Caterer Blog here.
Craig Beaumont, public affairs manager at VisitLondon, said: "The industry's efforts to kill off the Lyons bed tax have clearly been effective. It is heartening that ministers have heard the views of the industry from across London and the UK. Caterer and Hotelkeeper deserves credit for the role it played in highlighting the debate."
By Daniel Thomas