Who can blame Highland businesses for tourism tax worries?

Looking back, we can see the hard work, over many years, that has gone into making tourism a Highland success story. All of that effort means that tourism now accounts for twenty percent of the Highland economy. We all have a vested interest in ensuring that the success continues – and grows – supporting jobs and communities for the future.

It matters – and that’s why the Tourist Tax debate has caught the attention of local commentators and businesses alike.

On the face of it, a pound or two a night added to a visitors hotel stay seems like a simple, yet effective idea. One that is deployed in many cities across the world, and there are few visitors who will have quibbled about the extra cost on their bill at the end of a stay.

By paying a small tourist tax, you join thousands of others to generate much larger sums paying to protect, restore or invest in the infrastructure needed to support large numbers of tourists.

In Venice, the tourist tax even helps keep the very buildings themselves from disappearing below the water line. When you visit, it is clear what the money is to be spent on, and largely people are happy to pay the tax.

Unlike with Venice, there seems to be little detail about how a Highland Tourist Tax would work; what would it cost visitors, how it would be distributed, how it would be collected, and how much would it cost the Highland Council to administer?

Will the price increase every time there is a budget gap – could it be ten or twenty pounds in a few years?

We have heard the potential earnings for the Council, but what of the economic impact?

Will locals or visitors be engaged in the decision process of what the revenue would be spent on – is it filling potholes, more car parks, a super play park or what?

And, given our unique geography, where and how will it be spent?

The Highlands is not a city, yet I understand that this tax would apply all over the Highlands and in all seasons.

A booming summer season for hotels does not extend into the winter months, a fact known, only too well, by many rural Highland hoteliers trying to keep the doors open and staff in jobs from October through to March.

What of the impact on the North Coast 500 when fuel costs go up?

What happens, if and when the value of the pound increases?

All these costs add up and suddenly, that extra couple of pound a night for each room your family needs increases the cost of your holiday too much – making other European cities a better value for money choice.

So, who can blame hospitality businesses for raising concerns about a Highland Tourist Tax? After all, they know better than most, that growing visitor numbers isn’t something we can take for granted – especially with so many variables at play.

Countries such as Ireland and Germany have long provided a tax subsidy boosting jobs and visitor numbers, but our tourism sector has no such luxury. Instead they are subject to the second highest VAT rates in Europe under the UK Government -increasing the cost of a holiday in the Highlands by a fifth.

That’s why I have already written to the Chancellor to ask that he reduce the twenty percent VAT rate for tourism businesses, and I will continue to work with others to pursue this reduction.

Wouldn’t it be good to see our Highland tourism sector relieved of some of its VAT costs, so it can continue to thrive and increase visitor numbers?

Until we see a VAT relief to support our tourism sector, proposals such as a Highland Tourist Tax should remain an academic discussion for the future.

If not visitors may choose somewhere else that isn’t quite so taxing on their sense of fairness.

Drew Hendry MP
Drew Hendry MP










Highland Tourist Tax Background Articles: 




Drew Hendry is the SNP Member of Parliament for Inverness, Nairn, Badenoch & Strathspey and the SNP Westminster Spokesperson for Business, Energy, and Industrial Strategy.