Tourism tax could 'devastate' Wales

Government plans to introduce a 'tourism tax' in Wales have been criticised by hospitality and political leaders who said it would devastate the country.

Lake Vyrnwy Hotel
Lake Vyrnwy Hotel

The measure was announced as part of the Welsh Labour Government's draft budget earlier this week.

It would mean people holidaying in Wales would be forced to pay the levy which would be added to their hotel bill.

The specifics of the tax have not yet been decided, but it would be based on the model used in Spain.

Nothing is yet definite on the plans, and it will be decided when the Government puts together a full budget.

It could be a small charge per night for tourists staying in accommodation, with the money raised spent on public services and infrastructure related to tourism

Anthony Rosser, chair of the British Hospitality Association in Wales and manager of the Lake Vyrnwy Hotel, worries the tax would give an unfair advantage to businesses in England.

"It would be an utterly retrograde move," he said.

"We already have very real worries over the recent cauldron of costs that have boiled over in the last 18 months, including increases in business rates, wage increases, rising inflation and food and energy hikes. Increasing costs like this will, of course, be handing an unfair advantage to our competitors in England.

"What's encouraging is that it appears that the Welsh Assembly seems to have grasped the importance of hospitality recently. Great work is being done in that regard so it seems iniquitous that they should consider looking at a tourism tax."

Figures released by the Welsh Government yesterday showed that Brits took 4.24 million trips to Wales between January and June this year - an increase of 6.3 per cent on last year.

Tourists spent £724 million in Wales in the first six months of the year, and that is expected to continue to rise over autumn and winter.

Mr Rosser added: "Within Mid Wales tourism is one of the pivotal economies. What's interesting is that they money that is generated tends to stay in Wales and supports the rural economy. To come along and tax it seems peculiar but also dangerous."

A so-called tourism tax was introduced in 2016 in Ibiza and Majorca – with Thomas Cook slamming the levy as a “significant extra sum” on family holidays which could persuade many families to holiday elsewhere.

Assembly member for Montgomeryshire, Russell George, said the tax will discourage people from visiting Mid Wales.

He said: "This tax on tourists could devastate Powys, discouraging people from visiting Mid Wales and making the average family holiday much more expensive. Presumably this would apply during peak season, when parents already face a huge burden with inflated prices.

"The impact on jobs and the smallest hotels and B&Bs could be devastating. It’s the job of Welsh Government to attract people to come and spend money visiting Mid Wales, not deter them."

Welsh Conservatives have also criticised plans for the tax which they say could devastate small Welsh businesses and discourage people from visiting Wales.

The idea has been investigated and introduced in other parts of the world, and Plaid’s finance spokesman confirmed in the chamber on Tuesday that it could be used to pay for marketing.

Shadow Finance Secretary, Nick Ramsay AM, said: “This tax on tourists could devastate small firms, discouraging people from visiting Wales and making the average family holiday much more expensive.

“Presumably this would apply during peak season, when parents already face a huge burden with inflated prices

“The impact on jobs and the smallest hotels and B&Bs could be devastating.

“It’s the job of Welsh Government to attract people to come and spend money visiting our beautiful country – not meet them at the airport and fleece them.”

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