UK Government to Grant Mayors Power to Introduce Uncapped Tourist Tax

The UK government has confirmed plans to give mayors in England the power to introduce a nightly levy on overnight visitors, including those staying in hotels and Airbnb style rentals. Under the proposal, which is expected to be introduced as a bill in parliament within months, local leaders will be able to set a tax as a percentage of accommodation costs. Government sources stated that this structure is intended to protect budget holidays, though multiple reports highlight that the power will be uncapped, meaning there is no legal upper limit on how much mayors can charge. The move follows similar schemes already implemented in Scotland and Wales, as well as many European cities and the US. Housing Secretary Angela Rayner outlined the details to regional mayors during a meeting in Manchester. The government maintains that the majority of hospitality businesses will not be directly affected and that local leaders will decide whether to implement the tax and how to invest the revenue. However, the hospitality industry has expressed strong opposition. Allen Simpson, chief executive of UKHospitality, warned that a 5 percent levy could result in 33,000 job losses and a 2 billion pound hit to the economy. He argued that unlike taxes in cities like Paris or Rome, this power is open ended. Conservative leader Kemi Badenoch criticized the plan as a lack of imagination, stating that the government is simply taxing businesses instead of fostering growth. Mayor Andy Burnham of Greater Manchester, who previously introduced a flat fee visitor charge in 2023, is expected to use the policy as part of a wider devolution agenda.