Mayors in England will gain powers to introduce an overnight visitor charge after the UK government on Thursday (10 September) published its plans for an accommodation levy, a measure first proposed in last year's budget.
The plans will allow England’s 13 Mayoral Strategic Authorities, including London, to impose uncapped local accommodation levies. These will be charged as a percentage of the nightly accommodation rate rather than as a flat fee, and local leaders will be able to determine how the revenue is spent.
The government said the measure will bring England into line with destinations including Germany, Italy, the Netherlands, Canada and the US, where “similar” levies are already in place.
Scotland and Wales have also given local authorities powers to impose visitor levies. Edinburgh became the first Scottish city to charge an overnight accommodation levy when its 5 per cent nightly charge was introduced in July. Elsewhere in the UK, Manchester and Liverpool have also already imposed charges of £1 and £2 per night on accommodation bookings, respectively.
Subject to parliamentary approval, the government expects local leaders in England will be able to outline how levy revenues will be invested by March 2028. Mayors can also choose not to introduce a levy.
The move has drawn widespread criticism from hospitality groups and the business travel and meetings and events sectors.
In a joint statement on Thursday, the Business Travel Association (BTA), the Meetings Industry Association (MIA) and beam (business meetings accommodation and events) warned that, without the right safeguards, the levy “risks adding further cost to business travel, meetings and events and weakening the UK’s competitiveness”.
“Business travel is not tourism, and there is a real risk that distinction gets lost in this debate. Adding another accommodation charge on top of the UK’s existing 20 per cent VAT makes Britain more expensive for the very people and businesses we need to attract,” the associations stated.
“The impact on business meetings and events could be particularly damaging,” they continued. “Conferences, exhibitions and major meetings can involve hundreds or thousands of room nights, meaning even a modest charge can become a significant additional cost.”
The groups also warned that a "patchwork" of different charges "could make it harder for businesses to operate and leave the UK looking disjointed to international markets". They stressed mayors and local leaders must provide a consistent approach, along with transparency over how revenue from the levy is reinvested.