England’s visitor economy faces renewed uncertainty after the UK Government confirmed that regional mayors will be able to introduce a levy on overnight stays, prompting industry warnings about potential damage to international competitiveness and regional growth. UKinbound said the proposal raises significant concerns for tourism businesses already managing multiple costs imposed on visitors.
The trade association stated that any levy risks adding to existing charges faced by international travellers, while past experience in Scotland shows the administrative burden of percentage-based schemes. UKinbound urged the government to consult closely with industry, calling for a full economic impact assessment before new powers come into force.
Industry raises concerns over visitor charges
Joss Croft OBE, CEO of UKinbound, said the announcement that England’s mayors could introduce an overnight stay levy “will cause serious concern across England’s visitor economy.” He noted that overseas visitors to the UK already pay “a stack of charges including visa or ETA fees, some of the highest Air Passenger Duty rates in the world, and 20% VAT on hospitality,” which he said weakens the country’s attractiveness as a destination.
According to the association, additional charges risk compounding existing pressures on the sector, particularly as the UK competes with European destinations offering lower taxes or targeted incentives to attract long-haul markets. UKinbound emphasised that cost sensitivity remains a key factor in decision-making for both leisure travellers and tour operators, and warned that any new levy could become a deterrent at a time when destinations worldwide are increasing efforts to capture international demand.
Call for simple, low-cost design
The organisation highlighted Scotland’s experience as an example of implementation challenges associated with variable or percentage-based visitor levies. “Experience from Scotland shows that percentage-based levies create major administrative burdens for accommodation providers, intermediaries and local authorities, while delivering uncertain revenue and significant set-up costs,” said Joss Croft, CEO.
UKinbound argued that if England proceeds with new mayoral powers, any scheme should be designed to minimise disruption for small and medium-sized accommodation businesses, which comprise much of the country’s tourism infrastructure. Croft said: “If government proceeds, any scheme must be simple, fixed-rate and low-cost, protect small businesses, administered by local authorities rather than individual operators, and all revenue must be ring-fenced for reinvestment directly into the visitor economy.”
The association underscored that reinvestment is essential to ensure the levy delivers tangible improvements, such as supporting destination marketing, enhancing local tourism infrastructure, or strengthening regional visitor services. Without clear reinvestment commitments, UKinbound warned that destinations risk introducing a charge that provides limited benefit while increasing operating costs for businesses.
Industry leaders also stressed that clarity on administration will be critical. A fixed-rate model, they said, reduces complexity for both accommodation providers and guests, improves transparency, and limits the potential for disputes over calculation. Local authority administration would also reduce fragmentation, ensuring a consistent approach across each region adopting a levy.
UKinbound called for a full economic impact assessment before any powers are enacted, arguing this is necessary to “avoid untended consequences and further damage to our visitor economy.” The group said that modelling must consider the potential effect on inbound travel demand, regional competitiveness, group travel markets, and the broader hospitality supply chain.
According to the association, the UK cannot risk undermining the recovery of its visitor economy, which remains a significant employer and a key contributor to regional development. The sector continues to rebuild international demand following years of global disruption, and trade groups say additional barriers could hinder the pace of recovery in areas that rely heavily on tourism spending.
Croft added: “We urge the UK Government to work closely with industry to avoid measures that could make the UK less competitive, less attractive to international visitors, and put jobs and regional growth at risk.” His comments reflect wider industry sentiment that tourism taxation must balance local revenue needs with the sector’s international competitiveness.
As the government moves forward with devolving levy-setting powers to regional mayors, the tourism sector is preparing for further consultation and potential policy development. UKinbound and other industry bodies are expected to continue advocating for a clearer national framework, arguing that consistency, simplicity and targeted reinvestment will be essential if England opts to join the growing number of destinations introducing visitor levies.
