Businesses in some of the United Kingdom’s most popular tourist destinations have expressed serious concerns about the introduction of a tourist tax, describing it as a potential “hammer blow” to the sector. Both local accommodation providers and tourism officials are urging the Government to proceed cautiously before implementing the policy.
Caron Cooper, who has operated the renowned Fosse Farmhouse bed and breakfast near Castle Combe in Wiltshire for over four decades, spoke out about the challenges facing the tourism industry. The Georgian property has garnered international attention, particularly from Japanese visitors, after inspiring the popular animated series Kinmoza, which has attracted over five million viewers. Ms Cooper and her establishment were also featured on an episode of Gordon Ramsay’s Uncharted: UK Showdown, where she cooked alongside the celebrity chef.
“I’ve had my B&B in the Cotswolds now for 42 years, and tourism has always been challenging,” Ms Cooper told the Press Association. “We’ve faced many difficulties, including rising business rates and the severe impact of the Covid-19 pandemic. Just as we felt we were recovering and tourism was returning, this new levy feels like a hammer blow.”
READ MORE: Government Considers Four Key Changes to UK Number Plate System
READ MORE: HMRC Updates Treasury Committee on State Pension and Child Benefit Errors
In Cumbria, a similarly popular tourist area, Gill Haigh, managing director of Cumbria Tourism-a body representing 4,500 industry members-highlighted the importance of tourism to the local economy. The sector supports approximately 43,000 jobs, equating to 26% of employment in the county. The Lake District alone receives around 40 million visits annually, with 7.25 million staying overnight.
Ms Haigh detailed the financial pressures already placed on the industry, noting that England is unusual in imposing a 20% VAT rate on tourism services, compared to an average of 10% across Europe. “We are already a more expensive destination,” she said, “and we cannot afford to become less competitive. We have consistently urged that any mayor considering this levy should first conduct thorough economic and social impact assessments to fully understand both potential benefits and unintended consequences.”
Ms Cooper added that a flat-rate charge, such as an additional £1 per booking, would be more manageable for businesses and visitors alike. “Those staying in five-star hotels who spend £500 a night might hardly notice a 5% increase,” she said. “But for guests staying at bed and breakfasts, which are often budget-conscious travellers, an added percentage could make a significant difference. A flat fee would be fairer and less burdensome on those with modest budgets.”
Both Ms Cooper and Ms Haigh urged policymakers to adopt an evidence-based approach when considering the Overnight Visitor Levy, warning that without careful evaluation, it could have detrimental effects on the tourism economy.
“The Government is looking for revenue wherever it can find it, and tourism is seen as an easy target,” Ms Cooper concluded. “However, the wider consequences for businesses and employment must not be overlooked.”