City councillors have voted in favour of a controversial "tourist tax" which would see the Scottish capital becoming the first UK city to start charging visitors extra.

There are a number of forms the 'transient visitor levy' or TVL could take, including a proposed £2 ($4) bed-tax for hotels and B&Bs hosting overnighting visitors.

However it's unlikely that this will be in place in time for August and peak festival season, when the city grows by 2.7 million visitors.

What is for certain is that it will be one of the first to introduce an extra charge for
Adam McVey Edinburgh City Council leader explained to the BBC that it would work on similar lines to occupancy schemes already paid by tourists elsewhere: "It'd be a very similar scheme to those operated in Rome or Florence."

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Festival city: Edinburgh is looking to cash in on popular tourist events such as Hogmany. Photo / Roberto Ricciuti, Getty Images
Festival city: Edinburgh is looking to cash in on popular tourist events such as Hogmany. Photo / Roberto Ricciuti, Getty Images

"It'd be a small charge each night which would go towards investing and sustaining the most important parts of tourism, which has been one of the most successful part of our economy."

90 per cent of residents are broadly for the new tax, with the Edinburgh Chamber of Commerce also sharing this view - though exactly how the money will be raised and what it will be spend on remains a concern.

The ECC's Liz McAreavey wanted "more detailed information from City of Edinburgh Council as to exactly what they propose to do with the funds raised via a TVL."

Some small businesses, including some hoteliers and representatives for city's hospitality industry, have met the move with scepticism.

Garry Clark of the Federation of Small Businesses said that he was "very disappointed" by the plans. 76 per cent of the businesses, including bars and restaurants, were against anything that could dent tourist numbers, sharing views that it could damage the local economy.

Smaller B&Bs and hotels were worried that they will become "unpaid tax collectors" for the TVL.

The FSB estimates the tax could cost them £40m ($76m) in missed revenue.

Clark called instead for sustainable growth, rather than looking to dissuade visitors and cash in on a quick tourist levy.

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Festival tax: The Fringe theatre festival attracts 2.7 million visitors to the city every year. Photo / Getty Images
Festival tax: The Fringe theatre festival attracts 2.7 million visitors to the city every year. Photo / Getty Images

The Edinburgh summer festival numbers are unlikely to be affected by this new charge facing visitors.

The three main festivals - the Edinburgh Royal, the Fringe, and Edinburgh Book festival - which all take part in August, are seen as the driving force behind a popular tourist tax.

The Fringe Festival, which recently celebrated its 70th year, hosts over three thousand annual events, with only the Olympics or the Football World Cup selling more tickets.

Other UK cities watching Edinburgh closely include Oxford and Bath – the popular Somerset spa town mooted a tourist tax last year.

A night in Europe: The cities already operating a tourist tax

Cities in 15 of the Europeon Union's 27 member states are already charging tourist taxes. Although they are all referred to as 'tourist taxes', they share few similarities in either cost or method of collection. Here are some of the most commonly encountered.

Tassa di soggiorno: Venice joined the Italian cities to charge tourists extra. Photo / Getty Images
Tassa di soggiorno: Venice joined the Italian cities to charge tourists extra. Photo / Getty Images

Italy

Tassa di soggiorno is perhaps the best known 'tourist tax'.

Rome, Florence and Venice all collect a bed tax for overnighting visitors.

Like everything in Italy, it's more complicated than promised.

In Rome this ranges from €2 ($3.35) in a 2-star apartment to €3 ($5) in hotels four-star and above.

Florence and Venice can charge up to €5 ($8.40) a night for tourists staying in five-star hotels.

Some cities also charge a congestion tax for visitor cars and coaches.

Greece

Tourists were first charged the visitor levy in 2018, and its commonly collected directly on check in.

It ranges from €0.50 (84c) in B&B apartments though to €4 ($6.75) a night in five-star hotels.

Germany

Varying from city to city, the Bettensteuer can cost from as much as 5 per cent on a room rate to €1($1.68) a night in Trier.

Sometimes euphemistically termed Kulturförderabgabe or "cultural contribution" it might surprise you to know that Munich is completely free of additional tourist taxes.

Additional information can be found here: etoa.org