Edinburgh tourist tax: Survey finds public backs 5 per cent levy to be spent on infrastructure and services

'Edinburgh will be an exemplar to the country'

Edinburgh's tourist tax should be set at about 5 per cent with the money raised being used for infrastructure, city services, festivals, culture and heritage, according to the findings of a survey of public views.

Legislation allowing councils to impose a visitor levy on overnight accommodation is still going through the Scottish Parliament.  But Edinburgh council, which has advocated such a levy for years, is eager to be ready to bring in the tax as soon as it gets the go-ahead. And work is already under way between the council and the tourism sector on how it will operate.

Tourists to Edinburgh are expected to face a percentage levy on the cost of their room. Picture: Lisa Ferguson

Council leader Cammy Day said a levy of between 3 and 5 per cent could bring in and extra £20 million to £30 million for Edinburgh. "It's just the norm across Europe," he said. "It's time for it to come to Edinburgh."

Edinburgh is expected to become the first place in the UK to introduce a tourist tax. Clr Day said: "Edinburgh is ready to go with this and I think we will be an exemplar to the country." The council conducted a survey of residents, visitors and other members of the public, which attracted nearly 4,000 responses and found 85 per cent overall support for a visitor levy.

Among visitors, support was much lower at 53 per cent.  But Cllr Day said he did not believe the tax would put people off coming to Edinburgh when so many other cities in Europe and around the world had a similar levy.  "I don't have any worries that the four million-plus people who already come to Edinburgh will be deterred by paying a few pounds more."

And he said despite initial opposition, the tourism sector had come round to the idea. "They have moved from being against it to accepting it's coming and now they want to influence how the money is spent across the city to improve the offer to people who visit Edinburgh and the people who live here." 

The survey found residents backed a percentage tax rather than a flat rate levy by 53 per cent to 35 per cent, while visitors preferred a flat rate by 42 per cent to 35 per cent. When asked how much it should be, the most popular rate was 5 per cent, chosen by 35 per cent of respondents. The next most popular was 3 per cent, backed by 15 per cent.

Cllr Day said a percentage was fairer. "It means that whether you stay at the Balmoral or a B&B in Leith, you'll pay an appropriate sum for that." He has previously talked of a 4 per cent levy and welcomed the survey's finding that most people backed the charge being set at around that level.

Council leader Cammy Day does not believe the visitor levy will deter tourists. Picture: AFP via Getty Images

"If it's too low the impact of the resources we would raise would be too low. Nor do we want to go too high and make it unsustainable. The sector, having accepted it's coming, would rather have it bringing in a decent income to do something - if it's 1 per cent, it's nothing; if it's 5 per cent that's a good bit of money and I'm sure they're already thinking about where they'd like to see it spent."

Some 63 per cent of all respondents agreed the levy should apply all year round rather than just in the peak season. And 45 per cent thought there should be no exemptions. But one in 10 residents said people working in the festivals and artists should be exempt from the charge. On how the money should be spent, almost all respondents, ranked the city infrastructure in their top three priorities, followed closely by city services. Three-quarters of people also ranked culture, heritage and festivals among their top three priorities.

The proposed legislation currently requires the proceeds of the visitor levy to be reinvested locally in "developing, supporting or sustaining facilities and services which are substantially for or used by" visitors. However, Edinburgh is looking for more flexibility and a wide range of potential uses for the money have been floated, from more public toilets and removing graffiti to upgrading city parks or more frequent emptying of litter bins.

Cllr Day said: "It will be a tough decision what we actually spend it on. It's a lot of money - but there will be a lot of demands on it."

Once parliament has passed the legislation, the next step is for council officials to draw up the details of the visitor levy scheme for Edinburgh, which is expected to be presented to councillors for approval in August. The formal consultation on the proposals would then take place in the autumn, with a finalised scheme, taking into account consultation responses, being concluded by the end of the year.

Once the council has given final approval to the levy, the legislation currently provides for an 18 month implementation period, which Edinburgh council has argued is too long and hopes can be reduced to 12 months. But it looks as if the earliest the visitor levy could be introduced is 2026.