Plans for a proposed 7% “tourist tax” in Aberdeen will be considered by councillors next week.
The visitor levy allows councils in Scotland to charge a fee or tax for overnight stays in hotels, bed and breakfasts, and other types of accommodation.
A 5% levy was agreed by councillors in Edinburgh last month, and Glasgow has just begun a consultation on a similar 5% tax.
A report going before Aberdeen City Council at next week’s Finance Committee is asking councillors to approve a consultation on the proposed 7% levy, which would result in an estimated average increase of about £5 per night for visitors, although 7% would also make it one of the highest levies in Scotland.
The earliest date the tax could be introduced in Aberdeen would be April 2027.
Fiona Campbell, CEO of the Association of Scotland’s Self-Caterers, commented:
“Aberdeen City Council are putting the cart before the horse. If they desire to grow their tourism-related economy, this is precisely the wrong way to go about it. A punitive rate of 7% would be more than that envisaged by other cities like Glasgow or Edinburgh. Moreover, it is important to understand this is a tax on a tax: the 7% levy itself would be subject to 20% VAT, something unheard of in Europe. Other destinations have a reduced rate of VAT on tourism services, where Scotland does not.
The Council also need to be open about who will be paying. This is not an ‘international’ visitor levy paid only by foreign tourists with exemptions for residents, but one applicable to ordinary Scots staying overnight in Aberdeen, those who have already made a financial contribution to local services. Cruise ship passengers docking at Aberdeen harbour won’t be captured by it.
However, it will be a tax on those with overnight stays taking in a concert at the P&J Live or Music Hall; it will be a tax on those staying in accommodation while visiting a relative at Aberdeen Royal Infirmary; and it will be a tax on key workers in the energy industry requiring a stay before heading offshore. And as with all taxes, the only way is up, especially when councils are starved of funds. A rate of 7% smacks more of an easy revenue raiser than anything else.
Aberdeen Council must take stock, tread carefully and listen to the voice of business who will ultimately be responsible for administering this. Overall, any levy must be set fairly, have good governance and thoughtful implementation at its heart, and monies raised for tourist infrastructure only. Failure to take these steps could result in a policy that erodes the very industry it is supposedly intended to support.”
David Weston, of the Scottish Bed and Breakfast Association, also said he had concerns about the potential impact of such a levy on visitor numbers.
Of the 7% figure, he told BBC Scotland News: “I’m astonished, because Aberdeen does not suffer from over tourism.
“They’re not looking at all at the dangers to tourism and the damage that would to do to tourism, to Aberdeen, which would have a wider impact across the whole of the economy.”
Marc Crothall, chief executive of the Scottish Tourism Alliance, said there was a time and a place for the levy.
“Importantly, the proportionality of the levy that would be applied needs to be right,” he said. “We can’t afford to get this one wrong.
“Taxing a tourist with a punitive level of tax to be honest with you, is very definitely not the right way to go right now, in the climate we’re facing.”
