Manchester Imposes UK’s First Tourist Tax

Manchester has become the first city in the UK to introduce a tourist tax which will cost an additional £1 per night for accommodation stays The Manchester Tourist Tax , also known as the City Visitor Charge , is a flat rate of £1 per night per room that is charged to overnight visitors staying in hotels, hostels, and other types of accommodation in the city centre of

Manchester

From the beginning of the month (April) ever y ‘hotel and shor t stay ser viced apar tments’ in the city centre with a rateable value of £75 000 or more will charge the fee

The money raised from the tax will be used to fund a range of projects that will improve the visitor experience in Manchester, such as:

• Improving public transpor t: The money wi l be used to improve public transpor t in the city centre suc h as by ncreas ng the frequenc y of buses and trams

• Improving the city’s cultural attractions: The money will be used to mprove the city’s cultural attractions suc h as museums and galler ies

• Improving the city’s green spaces: The money wil be used to improve the city’s green spaces suc h as parks and gardens

73 hotels and shor t stay ser viced apar tments located within the centre of Manchester and in par ts of Salford signed up the scheme The new charge comes as 6 000 hotel rooms are due to open in Manchester over the coming years, which is expected to attract a fur ther one million overnight stays

Annie Brown the first chair of ABID said: The goal of the Manchester Accommodation BID is simple – we need to increase overnight stays in line with that growth so that hotels and ser viced apar tments in the city can continue to thrive

“ANTI-COMPETITIVE TAX”

Elsewhere in the UK, Wales is also set to introduce legislation that will enable a tourist tax Legislation allowing local authorities to introduce a levy will be put to the Senedd within the next two years, the Welsh government has said

It has also published the findings of a public consultation on the topic Suppor ters say the tax would contribute towards maintaining and investing in holiday destinations - opponents say it would put people off visiting Wales

David Chapman executive director at UKHospitality Cymru is “deeply disappointed” with the news He said: “This tax on beds is widely opposed by the accommodation sector in Wales who see it as anti-competitive and another restriction on an industr y in the midst of its recover y and rebuilding effor t

While the Welsh government is right that visitor levies are common around the world, what they fail to mention is that in those countries they have a significantly lower level of VAT and other taxes incurred by British hospitality The introduction of this tourist tax simply raises the tax burden on our businesses even higher to punitive levels compared to the rest of the world, making us yet more uncompetitive compared to similar destinations ” Chapman added Edinburgh is another city which is also considering the introduction a £2 nightly tourist tax and is currently subject to approval from the Scottish parliament Oxford, Bath and Hull have contemplated similar moves in the past but, thus far have decided against the decision

“DAMAGING EFFECT”

Five years ago, then Chancellor Philip Hammond mooted the idea of a tourist tax which proposed a £1 to £2 levy incurred by visitors staying overnight in cer tain UK cities, and was heavily criticised

Kate Nicholls, Chief Executive of UK Hospitality, voiced concerns in 2018 that the measure could potentially have a damaging effect on the hospitality sector as a whole

In the group ’ s letter to the Chancellor, she said: “I am writing to convey our profound opposition to such a policy and our sincere concern over the impact any additional taxation would wreak on an already-strained and overburdened sector ”

Ms Nicholls suggested that the proposed levy would ‘wreak havoc’ on a sector which employs approximately one in 10 of the UK’s working population, argue that the tax could give way to a number of negative outcomes, such as reduced tourism leading to businesses losing out on customers

“Conversely, those who come for a day trip, stay with friends or use a home-sharing ser vice , such as Airbnb, will not contribute a penny despite using local amenities she wrote