The government is being urged to amend its “arbitrary” advice for the leisure industry at a time when UK tourism businesses are at grave financial risk of collapse.

The call came from UKinbound as it emerged that many of its tour operator and destination management company members are not able to secure Business Rate Relief and related grants from their local authorities. This is because the housing and local government ministry [MHCLG] does not believe they are part of the leisure industry.

The view that operators are not leisure businesses has been based on the fact that customers do not enter premises to make a purchase.

UKinbound is urging MHCLG to address this lack of understanding as to how leisure businesses operate.

The trade association representing the inbound tourism sector has written to MHCLG calling for guidance to local authorities on Business Rates Relief and grants to be amended to include operators and destination management companies.

Many local councils have raised the importance of helping these businesses, and the wider tourism supply chain, with the Local Government Association. But there continues to be discrepancies with regards to relief and grant support throughout the UK.

UKinbound chief executive Joss Croft said: “This arbitrary decision to instruct local councils to exclude certain tourism businesses from vital financial support is not only confusing and frustrating for all involved, it also shows a real lack of understanding of how our industry operates.

“For example, a travel agent that sells a customer a ticket for a tour is eligible for support but the tour operator that actually takes the customer on the tour is not.

“Failing to help these businesses also puts at risk thousands of other businesses that generate a large percentage of the revenue that the UK earns from inbound tourism.  Last year inbound tourism generated £28.4 billion for the UK economy.

“Furthermore, all local authorities benefit from a strong visitor economy and losing key businesses will significantly impact on their budgets, including their ability to raise income to reinvest in local public services.”

He added: “My members are of course very grateful for all the support that the government has put in place for the tourism industry to date, such as the Job Retention Scheme and financial loans and many of my members are now thankfully preparing to re-open their businesses in the coming weeks.

“However, tour operator members, who rely almost 100% on international visitors for their income, are now facing the likelihood of earning no income over the peak summer months, due to uncertainty over international travel restrictions and UK quarantine measures, which will add further to their financial problems.

“We are therefore asking government to amend the guidance to local authorities on Business Rates Relief and grants as quickly as possible, so it fully reflects the government’s intention to provide support for all leisure businesses.”

Rob Russell, chief executive of AC Tours, which brought in more than 100,000 international tourists to the UK last year, said:  “When we applied for business grant relief, we were told that we are not eligible as our address is registered as an office – surely we should be judged on what we do and not our building registration.

“Tour operators such as ourselves work on tiny margins when compared to a number of other industries and being able to benefit from the support of the business rates relief could well be the difference for business survival through Covid-19.”