Fury as Rachel Reeves plots new ‘lodge tax’ on British vacationers | Politics | News | EUROtoday

Chancellor Rachel Reeves’ bid to repair Britain’s funds may lead to holidaymakers paying a lodge tax.

Officials on the Treasury are believed to have seemed on the attainable affect of bringing in a vacationer tax much like these utilized in vacation hotspots on the continent, the place visitors may be charged additional per night time for lodging.

The Welsh authorities has already introduced plans for a customer levy from 2027 which may see individuals pay £1.25 per night time for accommodations, B&Bs and guesthouses or 75p fro campsites and hostels.

A vacationer tax in Edinburgh for guests to the Scottish capital will likely be set at 5% of the price of lodging which the native council hopes will elevate about £50million per 12 months. Councillors within the metropolis will vote on the proposals which if handed will take impact from July 2026.

But Kate Nicholls, chief govt of UK Hospitality, mentioned a vacationer tax would do untold harm to Britain’s tourism trade.

She instructed Express.co.uk: “The UK remains one of the biggest visitor destinations in the world, but the number of inbound visitors hasn’t yet returned to pre-pandemic levels.

“As nicely as coping with different financial shocks over the previous 4 years, our hospitality sector continues to be recovering and we shouldn’t be contemplating charging guests, international or home, a further tax.”

She went onto say that the UK already performs poorly when it comes to global tourism.

Ms Nicholls said: “The UK already ranks poorly in its competitiveness on the worldwide tourism stage, with our excessive price of VAT, and the introduction of a vacationer tax would solely harm that additional.”

She added: “Hospitality companies are already burdened with rising prices in each a part of their operations, with a further £3.4billion in employment prices and enterprise charges hitting in April, so additional taxes on the sector could be extraordinarily damaging to the sector.”

Kate Allen, owner of luxury holiday company Finest Stays, told Express.co.uk that such a move would be nothing short of “outrageous”.

She said: “Introducing a ‘vacationer tax’ could be an outrageous transfer and an absolute travesty for Britain’s tourism trade, which is already beneath immense strain from latest adjustments to FHL (furnished vacation lettings) tax laws and elevated HMRC reporting calls for.

“At a time when the industry is striving to recover and remain competitive, adding further costs for holidaymakers risks deterring visitors and causing irreparable harm to a vital sector of the economy. The Chancellor must look elsewhere to balance the books.”

Hotelier, Sir Rocco Forte, warned an additional tax would harm Britain’s vacationer trade. He mentioned journey and tourism is an important a part of the UK economic system, contributing greater than £250billion yearly to UK financial development and supporting 3.5 million jobs.

Mr Forte added that aside from the very smallest companies, everybody attempting to make a dwelling on this space is being hit by the Government’s improve in employers’ National Insurance and the entire trade is affected by the refusal to revive tax-free purchasing for vacationers.

The Government has additionally “hit” tourism by elevating the levy on air journey, main Mr Forte so as to add: “It beggars belief a new tourist levy could be imposed on top of that.”

He mentioned: “This would be a pernicious new tax charged on top of all other taxes. The UK is already not a cheap destination and this can only deter cost-conscious visitors who will increasingly choose to go elsewhere.”

The outstanding UK businessman warned guests would possible spend much less whereas in Britain as a result of their lodging could be costlier, impacting your entire tourism economic system, together with eateries, vacationer points of interest and retailers.

Mr Forte claimed whereas different nations ring fence the cash raised from tourism taxes, the Labour Government will “doubtless” use the cash to plug the black gap it has created within the public funds.

A Treasury spokesperson mentioned: “We do not comment on tax speculation outside of fiscal events.”

Meanwhile, a Treasury supply mentioned nobody ought to be beneath any doubt that assembly the fiscal guidelines is non-negotiable and the Government could have an “iron grip” on the general public funds.

They mentioned the Chancellor has been clear she won’t repeat the October Budget and has requested the Office for Budget Responsibility to supply an financial and financial forecast on March 26 which can present a transparent evaluation of efficiency in opposition to the fiscal guidelines.

The supply added: “We will not give a running commentary. Difficult decisions have already been taken on spending and the Spending Review in June will root out waste in public spending and ensure taxpayer money is focused on the Prime Minister’s Plan for Change.

“This consists of boosting development to place extra money in working individuals’s pockets. The Chancellor retains all taxes beneath evaluation and makes tax choices at fiscal occasions.”