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New rules unveiled

Short term letting faces tax and regulatory crackdown

Tourism in Edinburgh

Tourists flock to Edinburgh, putting pressure on accommodation pic: Terry Murden)

Short term letting in Edinburgh is likely to be taxed and brought under tighter control after the Scottish Government confirmed a new regulatory regime.

Housing Minister Kevin Stewart announced measures in the Scottish Parliament to provide local authorities with the ability to implement a licensing scheme for short-term lets from spring 2021.

Councils will be able to designate control areas to ensure that planning permission will always be required for the change of use of whole properties for short-term lets.

Ministers will also consider how short-term lets will be taxed in the future to ensure they make an appropriate contribution to local communities and support local services.

The approach taken to short-term lets will be considered alongside the tourist tax or transient visitor levy bill, which will be introduced later this parliament.

High numbers of short-term lets are causing problems and often make it harder for people to find homes to live in

– Kevin Stewart, Housing Minister

Local Government Minister Kevin Stewart said: “Short-term lets can offer people a flexible travel option and have contributed positively to Scotland’s tourism industry and local economies across the country.

“However, we know that in certain areas, particularly tourist hot spots, high numbers of short-term lets are causing problems and often make it harder for people to find homes to live in.

Edinburgh City Council leader Adam McVey said it was “welcome news” to help reduce the impact short term lets have on the supply of homes and stem anti-social behaviour. He pledged to work with the Scottish Government on the details of the new system.

Residents have complained that the growth of short term letting, particularly through companies such as Airbnb, is hollowing out communities and squeezing the availability of homes to rent.

Councillor Mr McVey said: “Today’s announcement by the minister is extremely welcome news and will give us the controls that we need over short term lets for our residents and communities across Edinburgh.

“It meets our request for mandatory licences and we will now be in a position to more effectively implement planning controls to stop this increase. A review of taxation in this area will also make sure that businesses are paying properly for income they’re receiving and local services they’re using.

“In 2018, we set up a working group to look at this in detail and provide recommendations, the main one being the need for a regulatory system. Since then we’ve been working closely with the Scottish Government on the implementation of a new regulatory system, so I’m delighted that we’ll now be able to take this forward, and soon.

“This news also comes on the back of our successful campaign to introduce a tourist tax which will also make sure that visitors to the city are financially contributing to the services that they use. All of which, are part of a package of measures to better manage the enormous success of our tourist economy.

 “We’ll now work with the Scottish Government on the details of the new system which I hope will allow us to react quickly when rules are breached as well as addressing the particular challenges we face in Edinburgh such as housing being taken out of supply, rising rents and anti-social behaviour.

 “Next week we will also set out how we propose to tackle this issue through the introduction of new planning policies in our consultation document ‘Choices’ for the next local development plan City Plan 2030.”

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