Bed tax

Local authorities urged not to consider bed tax

By Michelle Perrett

- Last updated on GMT

Council deliberates: beds in Bath could face a tourism tax
Council deliberates: beds in Bath could face a tourism tax

Related tags: Local authorities, Local government

The Association of Licensed Multiple Retailers (ALMR) has urged local authorities to avoid new tax burdens on operators.

The call comes after news broke that Bath and North East Somerset Council is considering implementing a “tourist bed tax”.

Conservative councillor Charles Gerrish has been reported as saying on BBC Radio Bristol that the local authority is considering the tax as a way of generating additional revenue. He said the tax would be paid by customers staying in accommodation or B&Bs in the area.

The council told the that it had recently started to discuss the matter again with the Government and was exploring the feasibility with other local authorities. However, no decision would be made without a change in legislation at a national level.    

The ALMR has warned against any proposals to introduce additional costs for hospitality businesses and said it believed that any tax on Bath venues could be detrimental to the tourism economy.

ALMR chief executive Kate Nicholls said: “At a time when businesses are facing tightening margins and increased property and wage costs, and when pubs already pay a third of turnover in taxes, any additional costs burdens could have a hugely detrimental effect on revenue streams for retailers and undermine Bath’s economy.

“Businesses in Bath already contribute enormously through business taxes and engage in voluntary partnership work to promote the city’s fantastic hospitality sector.

“The council may view the tax as a good way to increase revenue, but the effects on tourism spend in the city are far from certain. The Government’s own response to the Lyons Inquiry states that local tourist or bed taxes could make the UK’s tourism and hospitality industries less competitive. With this in mind, we are urging local authorities to avoid increasing cost burdens for businesses in their areas and introducing taxes that may have an unfavourable effect on their own tourism offering.”

In 2004, the Lyons Inquiry examined the function and financing of local governments and rejected a proposed bed tax, saying it would make the hospitality industry less competitive.

Related topics: Property law

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