Scrap upcoming ‘tourist tax’, hundreds of hospitality bosses tell Reeves

More than 200 hospitality and leisure bosses have urged the government not to introduce a tax on people taking holidays in England.

Ministers have indicated that mayors and other local leaders in the country will be able to introduce a “modest” tourist tax, also known as a visitor levy, to raise revenue for the area.

English cities like Manchester and Liverpool have already introduced a similar measure, but this is an arrangement with local businesses, rather than a local authority tax.

In last year’s autumn budget, the chancellor confirmed that English regional mayors will have full powers to introduce visitor levies on overnight stays in hotels, Airbnbs and holiday lets.

But the hundreds of bosses of leading UK accommodation firms – including Butlin’s, Hilton and Travelodge – have urged chancellor Rachel Reeves to scrap the plans.

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They write that “holidays are for relaxing, not taxing”, arguing a visitor levy would hit families hard, put jobs at risk and drain money from local communities.

The government’s plans are designed to give local mayors more funds to invest in local infrastructure and transport. They mirror similar devolved moves in Scotland and Wales, with Scottish capital Edinburgh set to introduce a five per cent ‘visitor levy’ in July.

Mayors in London and Liverpool are already among those to have welcomed the plans, and indicate they will introduce levies.

In the letter, the industry bosses said: “This ‘Holiday Tax’ will hit families hardest, puts jobs at risk, drain money from local businesses and communities and undermine the Government’s growth agenda.

“For millions of hardworking families, a UK holiday is their chance to switch off and spend quality time together.

“For many, this tax will make their holiday unaffordable, meaning families will shorten trips, forgo a break altogether, reduce their spending with pubs, restaurants, events, leisure activities and local attractions, or travel overseas – spending their money and creating jobs elsewhere.”

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The hospitality operators also used the letter to reiterate some of their concerns about new pressures facing the industry, including: “rising business rates, energy costs, tax bills and employment costs.”

They added: “[The UK hospitality sector] already contributes billions of pounds in tax, through business rates, employment taxes and VAT, which at 20% is double the rate of competitors in France, Italy, Spain or Portugal.

“Do not turn the Great British break into a luxury. Scrap the holiday tax and back the families, workers and the businesses who make England worth visiting.”

A Government spokesperson said: “Tourists travel from near and far to visit England’s brilliant cities and regions.

“We’re giving our mayors powers to harness this and put more money into local priorities, so they can keep driving growth and investment in the economy, supporting thriving communities.

“We expect any new charges to be modest and in line with other countries, and it is for mayors to consider the right level for their area.”