Visitor levies: policy and debates

This briefing provides details of the legislation for, and introduction of, overnight visitor levies in the UK. It also includes details of alternative forms of ‘tourist tax’, including cruise passenger levies, day visitor taxes, and taxes on visitors arriving or departing a state or locality.

A visitor levy, sometimes called a “tourist tax”, is a charge linked to a visitor’s stay in short-term accommodation. Scotland and Wales have legislated to let local authorities introduce levies. The UK Government has proposed similar powers for strategic authorities in England.

Visitor levies usually apply per person, bed or room for each night of a stay. Authorities may charge a flat sum or a percentage of the accommodation price, vary rates by season or accommodation type, and exempt specified groups. The accommodation covered can include hotels, hostels, bed and breakfasts, campsites, self-catering properties and short-term lets.

Many countries ringfence the revenue, meaning it must fund specified purposes rather than general spending. Scottish councils must use proceeds for facilities or services substantially used by visitors. Welsh councils must spend them on destination management and local improvements, including infrastructure, services and measures to mitigate visitors’ impact.

The Visitor Levy (Scotland) Act 2024 gave Scottish local authorities powers to establish schemes after consultation and an 18-month implementation period. Edinburgh City Council introduced a 5% levy in April 2026 on the accommodation charge before value added tax, capped at five nights. It applies to hotels, hostels, bed and breakfasts and short-term lets. The council expects it to raise £45 million to £50 million annually by 2028/29.

In Wales, the Visitor Accommodation (Register and Levy) Etc. (Wales) Act 2025 created a national register of accommodation providers and two fixed rates. Camping and dormitory stays attract 75p per person per night; other accommodation attracts £1.30. Welsh councils may introduce the levy from April 2027. The Welsh Government estimated that a Wales-wide levy could raise about £33 million annually if every council adopted it.

English councils cannot currently introduce a statutory visitor levy. A November 2025 consultation proposed allowing combined authority mayors, the Mayor of London and potentially foundation strategic authorities to charge a percentage of accommodation prices. Mayors would consult publicly and publish proposed rates, areas and spending plans. The 2026 King’s Speech committed the government to legislate on the matter.

At present, some English cities use accommodation Business Improvement Districts (BIDs) as a workaround. A BID is a business-led body that collects an additional business rates levy after affected businesses approve it in a ballot. Participants in Manchester’s accommodation BID add a £1 nightly charge to guest bills. It raised £2.8 million in its first year.

Other forms of ‘tourist tax’ include charges on day visitors, cruise passengers and international arrivals. For instance, Venice charges day visitors €5 on selected dates. Cruise levies apply at ports including Lisbon and Amsterdam. The Scottish government has consulted on allowing councils to charge cruise ships, but has not made a final decision as of September 2026.