A planned £2 tourist tax for Edinburgh would lead to a downturn in forward bookings to the Scottish capital, it has been claimed.
The Scottish Tourism Alliance was responding to plans being finalised by Edinburgh City Council for the UK’s first tourist levy, capped at seven nights.
More than 2,500 residents and businesses responded to a recent council survey on the tourist tax, with the results suggesting 90% of residents are supportive.
It is estimated the tourist tax could raise up to £14.6 million a year.
Edinburgh councillors are due to discuss the proposal on February 7. If approved it will be formally submitted to the Scottish government.
But there has been a mixed response from accommodation providers, some who fear the tax could drive away visitors.
The STA claimed that a new consultation report on the tax – called a transient visitor levy – “lacks transparency, detail and the robustness required to provide the opportunity for proper, balanced consideration”.
The association argued that the report failed to address issues around the Brexit unknowns and “most notably the fact that the UK consumer spending is being squeezed, as evidenced in recent reports from the retail industry which reflect what we are seeing across the tourism industry”.
The STA added: “Research shows that a 1% increase in UK prices or relative exchange rates would lead to a 0.61% fall in tourism expenditure. This affects every business who benefits from Scotland’s tourism economy. If we tax our visitors more, they will spend less.
“We are in no doubt that further economic analysis, and examination of options must be done to assess the impact of a tourism tax on our tourism economy, together with a dispassionate examination of policy options, if the Scottish government’s position of having no plans to introduce a tourism tax were to change.
“The current picture of Scotland’s tourism industry is that of a challenged sector under pressure, enduring a continued pattern of rising costs, facing a recruitment crisis which has the potential to put our industry growth in decline.
“Neither Scotland’s tourism industry nor its consumers can afford to bear any additional costs.”
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