UK tourist tax: Where will it be introduced and how much will it cost?

Supporters argue the tax ensures visitors contribute to the upkeep of places

Local leaders in England will gain the power to introduce visitor levies starting in May 2027, following new legislation approved by the government. The policy allows councils in areas with high tourism to charge overnight guests a small fee, aiming to fund local services and infrastructure strained by visitor numbers. Accommodation providers have expressed concern that the added cost could deter tourists and harm their businesses, particularly in popular destinations like Cornwall, the Lake District, and coastal towns. The visitor levy will be set at a maximum of £2 per night per room, with local authorities deciding the exact amount and whether to apply it. Revenue generated will be ring-fenced for tourism-related improvements such as public toilets, waste management, and transport upgrades.

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Supporters argue the tax ensures visitors contribute to the upkeep of places they enjoy, while critics warn it could make UK stays less competitive compared to tax-free alternatives abroad. The Hospitality Association has called for exemptions for budget accommodations and longer stays to mitigate potential damage to the sector. How Will the Tax Affect Different Types of Accommodation? Budget hotels and hostels fear the levy will disproportionately impact their low-margin operations, potentially pushing prices beyond what cost-conscious travelers can accept. Luxury hotels, meanwhile, may absorb the cost more easily or pass it on without significant demand loss, according to industry analysts. Self-catering properties and campsites are also assessing how the fee might alter booking patterns, especially for families and longer holidays.

Some operators say they may need to reduce other amenities or staff to offset

Some operators say they may need to reduce other amenities or staff to offset the financial burden, raising concerns about service quality. What Happens If Visitors Choose to Go Elsewhere? There is growing anxiety that the tax could redirect tourism toward domestic destinations without levies or to international competitors offering better value. Coastal resorts in Wales and Scotland, which currently do not have equivalent visitor taxes, could benefit if English towns implement the charge. VisitBritain has warned that even small price increases can influence travel decisions, particularly in a post-pandemic market where affordability remains key. Monitoring cross-border tourism shifts will be essential in the first year of implementation to assess the policy’s real-world impact. Frequently Asked Questions Will the tourist tax apply to all overnight visitors? Yes, the levy will apply to anyone staying overnight in paid accommodation in participating local authority areas, regardless of where they live.

Can local councils choose not to introduce the tax? Yes, the power to implement the visitor levy is permissive, meaning councils must vote to adopt it before it can be charged. How will the money collected be used? Funds must be spent exclusively on managing tourism impacts, including infrastructure, environmental maintenance, and visitor facilities, with annual reporting required.