A holiday accommodation expert has warned policymakers to consider the combined impact of visitor levies, taxation and rising operating costs as tourism charges move up the agenda across the UK.
The warning comes after Cyngor Gwynedd delayed a decision on whether to introduce Wales’ new visitor levy, following 6,856 responses to its consultation.
Initial results showed that 79.5% of responding businesses and 79.9% of responding visitors opposed the introduction of the levy, while residents were more evenly divided.
The decision comes as tourism taxes are also being considered elsewhere in the UK.
The Government has confirmed that mayors and local leaders in England will be given powers to introduce an ‘Overnight Visitor Levy’, charged as a percentage of accommodation costs.
In London, Mayor Sir Sadiq Khan has said any levy introduced in the capital would not exceed 5% of accommodation costs, although the final rate has not yet been decided.
Laura Dubois of holiday home specialist Together Travel said the growing number of proposals means policymakers should consider how different measures could combine to affect the overall cost of a UK break.
“Gwynedd's decision to take more time over this is significant. When almost 80% of the businesses and visitors responding to a consultation oppose a proposal, it's right that those concerns are properly examined before a decision is made,” she said.
“The issue isn't necessarily one visitor levy in isolation. It's what happens when you add that levy to rising operating costs, changing tax rules and the other costs associated with running holiday accommodation.
“A few pounds or a small percentage can sound relatively insignificant when discussed on its own, but families don't experience the cost of a holiday that way. They see the final bill.”
Dubois said there was a legitimate argument for visitor levies where the proceeds are clearly reinvested in destinations and infrastructure, but warned that authorities also need to understand how additional charges could affect visitor behaviour.
“Tourism places real demands on local infrastructure, so it's understandable that councils want to explore ways of funding that,” she said. “But there must be a balance. If staying in Britain becomes progressively more expensive, there is a risk that people shorten their trips, spend less while they're there or compare the overall cost with travelling abroad.
“That doesn't just affect accommodation providers. It potentially affects pubs, restaurants, attractions, shops and the many independent businesses whose income depends on the visitor economy.”
The debate is also beginning to attract wider public attention in England. A parliamentary petition published on 21st September is calling for UK citizens to be exempt from any overnight visitor tax introduced by English local authorities.
Dubois said the differing approaches emerging across Britain make clarity particularly important for holiday accommodation businesses.
“Operators need to know not only what they're expected to collect, but how the money will be used and what benefit visitors and destinations will see in return.
“If a levy helps improve transport, public spaces, events or tourism infrastructure, authorities need to demonstrate that clearly. Otherwise, from a visitor's perspective, it can simply look like another addition to the cost of their holiday.
“Gwynedd's experience is a useful reminder of why consultation matters. The objective must be a tourism economy that works for residents, visitors and the businesses that support it.”
The changing landscape could also have implications for people considering investing in holiday accommodation.
Together Travel has previously urged prospective holiday-let owners to assess annual occupancy, local demand, taxation, running costs and the possibility of future regulatory change, rather than relying on headline peak-season rental figures.
Dubois added: “Holiday-let owners already have to build more uncertainty into their financial planning than they did a few years ago. That doesn't mean regulation or visitor levies are inherently bad. But good policy needs to be predictable, proportionate and based on evidence.
“Tourism is an ecosystem. If you change the cost at one end, you need to understand what that could mean for every business further down the line.”
