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Levy looks likely

Businesses dismayed after Highland Council backs tourist tax

North Coast 500

Businesses fear a tax will deter visitors to the Highlands

Visitors to the north of Scotland are likely to be charged a tourist tax after Highland Council voted to press ahead with the plan.

Business leaders reacted with “bitter disappointment” to the decision to draw up plans for a so-called “transient visitor levy” once final details have been agreed.

The move was backed  by 44 votes to four, with seven abstentions as councillors insisted revenue must be earmarked for roads, public toilets and other environmental improvements, as well as maintenance that directly supports the industry.

It will be closely watched by other areas, including Edinburgh, which are considering a similar tax.

Businesses were dismayed at the decision, fearing it will drive tourists away.

Inverness Chamber of Commerce, along with the chambers in Caithness and Lochaber and the Cairngorms Business Partnership, said the introduction of a TVL could affect the whole tourism sector, including lucrative business from cruise liner traffic. They fear cruise business could by-pass the Highlands, and even the whole of Scotland.

They also argued that the addition of VAT to any tourism levy will impose an additional administrative burden on all non-VAT registered businesses, many of them small, rural B&Bs.

Stewart Nicol, chief Executive of Inverness Chamber of Commerce, said: “We are bitterly disappointed at the council’s decision. This sends out a potentially damaging message to visitors who wish to come to the Highlands but may now decide to go elsewhere.

Imposing a local tax on visitors gives a clear statement that this area will be more expensive than others to visit

– Stewart Nicol, Inverness Chamber

“We have consistently said we recognise the challenge The Highland Council faces in responding to infrastructure and service pressure, but this is the wrong mechanism to tackle the issue.

“Imposing a local tax on visitors gives a clear statement that this area will be more expensive than others to visit. It will almost certainly influence where visitors will choose to stay and also be an additional layer of complexity to local taxation which could deter inward investment.

“The tourism sector is already facing unprecedented challenges with recruitment and retaining of skilled staff, a situation critically exacerbated by the prolonged and damaging uncertainty around Brexit.  

“The sector has been under significant cost pressure in recent years, particularly around business rates.  Regardless of how the levy is framed, this would act as a further unwelcome tax on this hard-pressed sector.”

The Scottish Tourism Alliance (STA) said in a statement: “The STA is disappointed but not surprised that Highland Council has voted to explore the idea of a tourist tax in more detail and start drawing up plans for what the implementation might look like, given the variations in support for the tax in its consultation.”

Transform Scotland, a sustainable transport charity, said last week it believed a tourist tax would have the backing of Edinburgh residents.

It carried out an online survey of 320 residents which found 78% of respondents believed a Transient Visitor Levy (TVL) would protect Edinburgh.

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