Labour and Plaid Cymru announce next steps in introducing tourist tax

The Welsh Government has confirmed a consultation on proposals for a local visitor levy will launch in autumn 2022.

Rebecca Evans, Minister for Finance and Local Government, said a levy would enable destinations in Wales to be enjoyed for generations to come. The Welsh Conservatives have opposed the tax saying it would be “devastating for businesses and the economy”.

Tourism provides a substantial economic contribution to Wales with tourism-related expenditure reaching more than £5bn annually in 2019. The Welsh Government argue that a tourism tax would raise revenue for local authorities enabling them to manage services and infrastructure which makes tourism a success.

The Labour party’s Welsh Government’s Programme for Government, and the Cooperation Agreement between Labour and Plaid Cymru, both contain commitments to introduce a tourism tax.

Rebecca Evans, Labour’s Welsh Government Minister for Finance and Local Government, said: “Visitor levies are a common feature in tourist destinations internationally. They are an opportunity for visitors to make an investment in local infrastructure and services, which in turn make tourism a success. Without such a levy, local communities face an undue burden to fund local services and provisions on which tourists rely. From keeping the beaches and pavements clean, through to maintaining local parks, toilets and footpaths – the critical infrastructure that supports tourism should be supported by all those that rely on it.

“The introduction and subsequent use of such a levy would enable destinations in Wales to be enjoyed for generations to come and encourage a more sustainable approach to tourism.

“The levy would be proportionate by design, and powers to raise the levy would be discretionary for local authorities. This would enable decisions to be taken locally, according to the needs of our communities. The levy will apply to those paying to stay overnight within a local authority area. Opportunities for wider contributions on the cost impact of other types of visitor activities on local infrastructure will be offered as part of the consultation on the levy.”

Plaid Cymru Designated Member Cefin Campbell MS said: “Giving local people the power to introduce a tourism levy will make a difference to communities across the country, many of which attract a significant number of tourists. It will give local people and their representatives more power and resources to invest and deliver in their areas.

“Councils will be able to ask tourists to contribute in a small way to the areas they are visiting and the local services they use.

“This measure will help support a sustainable rather than an extractive tourism sector, which will help bring the greatest benefit to communities and the local economy.

“Such levies – often known as tourism taxes – are commonplace in countries across Europe and beyond. This is about mutual respect between our communities and the visitors they welcome. It is a new policy which is the fruit of a Welsh co-operative spirit.”

The Welsh Conservatives meanwhile have reiterated their opposition for the scheme, pointing out that the levy was proposed in the last Senedd but due to widespread anger in the industry and Welsh Conservative opposition, the proposals were dropped.

Welsh Conservative Shadow Minister for Culture, Tourism and Sport, Tom Giffard MS, said: “Our economy is in a very fragile state at the moment and instead of working to get it fired up again, Labour and their nationalist friends in Plaid Cymru are actively seeking to damage it.

“A tourism tax poses grave dangers for Wales. Not only would it be devastating for businesses and our economy, but it would also leave jobs hanging in the balance.

“Labour and Plaid’s priorities are completely skewed. They should be focusing their energy on delivering a strong economic recovery after the pandemic rather than penalising businesses at this critical time.

“It is imperative Labour ministers drop this barmy plan before people’s livelihoods are hit.”

Formal consultation on draft legislative proposals for a visitor levy will launch in the autumn.