Internet State

The hospitality industry in the UK fears that introducing a tourist tax could lead to a significant reduction in visitors, with estimates from UKHospitality suggesting a 5% tax could result in 12 million fewer visits and 33,000 job losses. However, evidence from European cities like Amsterdam, Barcelona, and Venice indicates that such taxes do not deter visitor numbers; for example, Amsterdam's tourist tax is 12.5%, yet visits have increased consistently over the past decade. In the UK, Manchester has introduced a £1-a-night levy, generating £10.5 million for cultural projects in its first three years, and despite concerns, studies show that tourist taxes have not led to declines in visitor numbers in various locations.

Last year, Andy Burnham and Steve Rotheram advocated for an "overnight visitor levy" for English mayors, which has now been included in Keir Starmer's legislative agenda, mirroring existing systems in Scotland and Wales. Recent announcements revealed that this levy will be uncapped, allowing local leaders to impose potentially high taxes on accommodations, which could lead to significant job losses, with estimates suggesting up to 33,000 positions in the hospitality sector could be affected. UK Hospitality estimates that this tax could increase the cost of a family holiday in the UK by £100-£120, exceeding the financial relief offered by previous VAT cuts.

Tourists in England may soon face a nightly levy on hotel and Airbnb stays, with mayors given the power to set the amount charged, potentially raising hundreds of millions of pounds for local services. The proposed tourist tax, first introduced by Keir Starmer's government, could be calculated as a percentage of accommodation costs, aiming to avoid a flat fee structure that negatively impacts budget travelers. UKHospitality warns that a 5% tax—the highest in Europe—could jeopardize jobs in the hospitality sector and exacerbate the cost of living for holidaymakers.