Edinburgh could become the most expensive destination in Europe to visit, following a proposal of £2 per night tourist tax, according to evidence submitted by UK Hospitality (UKH).
The hospitality industry remains opposed to the tax and the introduction of a Transient Visitor Levy (TVL) will make the country less competitive and make the tourism market one of the highest taxed globally
Willie MacLeod, executive director at Scotland for UK Hospitality, said: “A TVL could be a disaster for the tourism industry in Edinburgh and across Scotland.
“The introduction of a £2 per room, per night tax will cost the economy between £175m – £200m per annum. At this time of great economic and political uncertainty, much needed jobs, tax revenues and investment will be put at risk.”
It is estimated that the introduction of a TVL would to lead to a reduction in accommodation turnover in Scotland of £128m per annum and an overall negative impact of £191m per annum.
Data collected by STR Global in 2018 showed that 15% of Edinburgh visitors would reduce their spending as a result of the tax, 5% would stay outside the city and 2% would not visit at all.
This change in behaviour is estimated to result in a decline in visitor spend of £94m per annum in Edinburgh. If mirrored across Scotland as a whole, it could result in a decrease in visitor spend of £205m per annum.
MacLeod added: “Instead, the Scottish Government and local authorities should continue to work with the industry, to expand the sector and secure further jobs and investment.
“UKH member businesses have invested significantly in Scotland, employ tens of thousands of people and cater for millions of overnight guests each year, contributing to the vibrancy and range of services available in our town and city centres.”
UKH’s position represents the views of 700-member businesses operating 70,000 outlets throughout the UK.