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

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? 

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.

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. 

He argued that a visitor levy would be “one tool that will provide additional resources to continue to attract visitors” to Scotland.

And he insisted the charge would be “less than the price of a cup of coffee” 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.

In Amsterdam, they have their toeristenbelasting. East, in Germany, there are the culture taxes – kulturförderabgabe – 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.

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.”

‘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”.

“Once again we’re seeing a one-size-fit-all approach from the Scottish Government which doesn’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 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.

The vice chairman of Aberdeen City and Shire Hotels’ 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 hasn’t?”