Aberdeen City Council’s proposal to introduce a 7% tourist tax has sparked concern among business leaders, who warn the rate could make the city more expensive for overnight stays than major European destinations such as Barcelona and Budapest.
The proposed Visitor Levy, currently under consultation, would see guests charged an additional fee when staying in hotels, B&Bs and other forms of accommodation. The policy aims to generate additional revenue to support the city’s tourism infrastructure.
However, the Federation of Small Businesses (FSB) has voiced strong opposition to the proposed rate. Mike Duncan, FSB’s development manager for north Scotland, described the levy as among the highest in Europe and cautioned against the potential reputational impact.
“A 7% levy would be the most expensive so far proposed in Scotland and one of the very highest in Europe,” he said. “Apart from the cost, Aberdeen must consider the perception this will create among potential visitors and whether it risks deterring them altogether.”
Duncan noted that other cities, including Glasgow and Edinburgh, are opting for a 5% rate, while some local authorities—such as South Ayrshire and the Western Isles—have paused or abandoned their plans altogether amid fears of negative economic impact.
Research cited by FSB, including a Welsh Government impact assessment, suggests such levies could reduce visitor numbers by up to 2.5% and lower annual spending by as much as £35 million.
“Aberdeen quite rightly has ambitions to grow its visitor economy,” Duncan added. “But adopting a levy at this rate represents a gamble with those ambitions.”
While tourist taxes are commonplace in many global cities, Duncan emphasised that Aberdeen’s position as a regional destination requires a tailored approach. “What works in Amsterdam or Berlin may not work here,” he said. “It is crucial to recognise that one size does not fit all.”
The Scottish Government granted councils the authority to implement local visitor levies in 2023, with each local authority free to determine the rate and scope of application. The Aberdeen consultation remains open, with further decisions expected later this year.
