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Everything you need to know about north-east ‘tourist tax’ as local leaders butt heads over levy

Aberdeen could use planned new powers to introduce a tourist tax in order to fund city improvements to attract more visitors.

The plans come as the tourism sector is struggling to emerge from the pandemic, while battling rising costs. Image: DC ThomsonĀ 
The plans come as the tourism sector is struggling to emerge from the pandemic, while battling rising costs. Image: DC ThomsonĀ 

A new tax on tourists could help fund multi-million-pound efforts to breathe new life into Aberdeen.

City council co-leader Christian Allard believes there is a “strong case” for councils being given the option of introducing a visitor levy.

But his Aberdeenshire counterpart is more pessimistic, warning of a dire impact on hotels.

It comes as the SNP Scottish Government made moves to change the law to allow local authorities the option.

  • Could a tourist tax form part of that plan for Aberdeen?
  • Why is the leader of Aberdeenshire Council against the initiative?
  • Could a ‘border’ emerge between the two local authority areas?Ā 
The arrival of the Aida Aura cruise ship in Aberdeen in early May is hoped to bring a new wave of tourists to the Granite City. Will they and other visitors be subject to the new tax in the future? Image: Wullie Marr/DC Thomson.
The arrival of the Aida Aura cruise ship in Aberdeen in early May is hoped to bring a new wave of tourists to the Granite City. Will they and other visitors be subject to the new tax in the future? Image: Wullie Marr/DC Thomson.

What is the tourist tax?

If passed, the Visitor Levy (Scotland) Bill will allow councils to impose an added charge on overnight visitors.

It would be a percentage of their accommodation costs.

Tourists aboard the Aida Aura cruise ship, which arrived in Aberdeen on May 2, wave to their welcome party. It was the first cruise ship to arrive at the new south harbour. Could passengers be subject to a tourist tax in the future?
Tourists aboard the Aida Aura cruise ship, which arrived in Aberdeen on May 2, wave to their welcome party. It was the first cruise ship to arrive at the new south harbour. Image: Wullie Marr/DC Thomson.

It would apply to those staying in hotels, hostels, bed and breakfasts, self-catering accommodation, camp sites, caravan parks and boat moorings or berthings.

Why would it be a good thing?

Public finance minister Tom Arthur suggested the cash would go back into promoting Scotland to lure more holidaymakers.Ā 

He argued that a visitor levy would be ā€œone tool that will provide additional resources to continue to attract visitorsā€ to Scotland.

Tom Arthur announced the progress. Image: DC Thomson

And he insisted the charge would be ā€œless than the price of a cup of coffeeā€ for many affected.

Money raised would be invested locally in facilities or services used by tourists, in consultation with communities on how it would best be spent.

When in Rome, tax as Romans do?

Major European destinations already place this cost burden on their visitors.

A taxe de sejour in Paris and Lyon is added to hotel bills, and it is the same in Rome and smaller Italian cities.

The Eiffel Tower in Paris, where tourists flock en masse. Image: Robert Thorne

In Amsterdam, they have their toeristenbelasting. East, in Germany, there are the culture taxes – kulturfƶrderabgabe – as well as bed taxes – bettensteuer – for tourists.

Edinburgh City Council has already set out plans to introduce a charge when the legislation comes in.

It is an idea that has been debated in Aberdeen for almost a decade.

When in charge of the council in 2016, Labour wanted to introduce a bed tax to help fund investment in culture.

Tourist tax: Cash for Aberdeen’s regeneration needed ‘from somewhere’

And hesitancy from the Aberdeen SNP then remains to some degree now, with the new co-leader stopping short of committing to the idea.

Tourists are expected to flock to the recently installed Aberdeen sign in the Castlegate for a memento of their trip to the Granite City. Image: Kami Thomson/DC Thomson.
Tourists are expected to flock to the recently installed Aberdeen sign in the Castlegate for a memento of their trip to the Granite City. Image: Kami Thomson/DC Thomson.

Mr Allard told The P&J: “If we are going to invest in our city, and make Aberdeen a more attractive place to visit, then that needs to be funded from somewhere.

“A visitor levy would provide an option to do that.”

SNP council co-leader Christian Allard said money to improve Aberdeen must 'come from somewhere'- and a tourist tax is one thing the local authority is looking at. Image: Wullie Marr/DC Thomson.
SNP council co-leader Christian Allard said money to improve Aberdeen must ‘come from somewhere’- and a tourist tax is one thing the local authority is looking at. Image: Wullie Marr/DC Thomson.

‘Empowered’ councils or a ‘one-size-fit-all’ tourist tax?

It was roundly criticised by the incoming leader of Aberdeenshire Council, despite the neighbouring city authority’s optimism.

And despite assurances tourist tax cash would be kept in the north-east to the benefit of the tourism trade, Conservative group leader Gillian Owen questioned “how much we’ll ever see coming back”.

New leader of the Conservatives on Aberdeenshire Council Gillian Owen is sceptical as to how much of the tourist tax would stay in the area if it were introduced. Image: Scott Baxter/DC Thomson.
New leader of the Conservatives on Aberdeenshire Council Gillian Owen is sceptical as to how much of the tourist tax would stay in the area if it were introduced. Image: Scott Baxter/DC Thomson.

“Once again weā€™re seeing a one-size-fit-all approach from the Scottish Government which doesnā€™t fit with how hospitality and tourism works in the north-east,” she said.

“My thoughts are with struggling operators who scraped their way through the Covid pandemic only to be told another tax is on the horizon.”

Could people staying in Westhill end up paying more than others on the opposite side of the Aberdeen and Aberdeenshire border? Image: Kami Thomson/DC ThomsonĀ 

Could tourist borderline emerge?

With differing opinions between the SNP-Lib Dem-run Aberdeen and the Conservative-led Aberdeenshire councils, the city boundary could become a borderline.

Unlevied rooms in Westhill might appear more attractive than those in Kingswells, which would be subject to Aberdeen byelaws.

Even if both did adopt a tourist tax, they could set it at different levels.

What do local hotel leaders say?

Hoteliers have in the past raised concerns about the impact on their business.

Stephen Gow who is also the general manager of The Chester Hotel. Image: The Chester HotelĀ 

The vice chairman of Aberdeen City and Shire Hotelsā€™ Association, Stephen Gow, complained: “Hoteliers definitely have more questions than answers at the moment.”

“Will it make some areas more expensive than others as one council has chosen to implement the levy and another hasnā€™t?”

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