Welsh Government to unveil ‘tourism tax’ Bill today

Finance Secretary Mark Drakeford is set to introduce a new Bill today, Monday, November 25,  granting local authorities the option to implement a small visitor levy in their areas.

If passed, the revenue from the levy or ‘tourism tax’  would be reinvested into supporting local tourism and preserving Wales’ natural beauty and heritage.

The proposed legislation, known as the Visitor Accommodation Bill, is a key Programme for Government commitment, originating from a 2021 agreement between Labour and Plaid Cymru.

The measure would impose a small charge on overnight stays in visitor accommodation, with all funds directed towards sustaining local services and bolstering the long-term future of Wales’ tourism sector.

In a quote published by the BBC, Finance Secretary Mark Drakeford emphasised the purpose of the levy:

“This is a Bill designed to protect and promote tourism. It’s a power for those local authorities that wish to use it, allowing them to collect a small amount of money from visitors coming to that area for re-investment in the things that make tourism a success in that area.”

How the Levy Will Work

Although the specific amount to be charged has not yet been revealed, ministers have suggested the funds could be used for initiatives such as cleaning beaches, maintaining public toilets, and preserving footpaths.

Economy Secretary Rebecca Evans MS has said the levy would be applied at the discretion of individual councils:

“Each local authority will be able to decide whether to introduce a visitor levy in its area, based on local circumstances.”

The Bill also proposes the creation of a national register for all visitor accommodation providers in Wales.

This register is intended to ensure fair competition and uphold high standards across the tourism sector.

It will also serve as a foundation for a future statutory licensing scheme that would ensure all accommodation providers follow consistent rules.

Mixed Reactions and Consultation Results

While the Welsh Government argues that the visitor levy will provide essential funding for communities and sustain the tourism economy, the proposal has drawn criticism from opposition leaders and some representatives of the tourism industry.

Andrew RT Davies MS, Leader of the Welsh Conservatives, voiced strong opposition, stating:

Concerns were echoed by many businesses during consultations, who highlighted the complexity of administering the levy and the risk of counties competing with one another over different tax rates.

However, a separate government-commissioned survey of UK residents found more positive responses.

Many supported the idea of paying a small levy while on holiday, particularly if the funds were reinvested into improving local facilities.

Implementation Timeline

If approved, the Bill may take several years before councils are able to implement the levy.

The Welsh Government has pledged to continue consulting with tourism stakeholders, accommodation providers, and local authorities to address concerns and refine the proposals.