Edinburgh's Tourist Tax: A Complex and Flawed System

Strategic Insights -

The introduction of Edinburgh's tourist tax has been met with widespread criticism from the city's accommodation providers, who claim that the complex and percentage-based system is causing them to break the law. The Scottish B&B Association has sounded the alarm, warning that hotels and B&Bs are being forced to manually add the visitor levy to their prices, causing "ridiculous and unacceptable" situations. The issue lies with booking platforms like Booking.com and Airbnb, which are not equipped to handle the five-night cap on the levy, leading to confusion and errors.

Key Takeaways:

  • The Scottish B&B Association claims that many accommodation providers are being forced to break the law due to complications with booking platforms like Booking.com and Airbnb.
  • The tourist tax, which applies to hotels, hostels, guest houses, B&Bs, self-catering accommodation, camp sites, and caravan parks, is a percentage-based system that is causing problems for businesses.
  • The five-night cap on the levy is causing issues, as booking platforms are unable to accurately calculate the charge.
  • Individual accommodation providers are legally responsible for collecting and remitting the levy to the council, despite the difficulties caused by the complex system.
  • The Scottish B&B Association warned the Scottish Government against introducing a percentage-based system, arguing that it adds an unnecessary layer of complexity to the scheme.
  • Public Finance Minister Ivan McKee has announced that the Scottish Government is considering a flat rate or tiered flat rate model alongside the existing percentage-based approach.
  • Edinburgh Council leader Jane Meagher has stated that the council is open to working with the Scottish Government on potential changes to the system.
  • Accommodation providers are being encouraged to raise concerns directly with their chosen provider, rather than relying on the council to resolve the issues.

Statistics:

  • The tourist tax could raise up to £50 million annually for the city of Edinburgh.
  • Booking.com has over 1,800 listings in Edinburgh and is unable to accurately calculate the five-night cap on the levy.
  • Airbnb is telling hosts in Edinburgh to apply the tourist tax by inflating their room rates, rather than having it automatically calculated at checkout.
  • The guidance emphasizes transparency for guests and accurate record-keeping, meaning hosts remain accountable even if a booking platform does not apply the charge automatically.
  • The Scottish Government has been warned about the complexity of the percentage-based system and the potential problems it could cause.

Sources:

  • The Herald
  • Scottish B&B Association
  • Edinburgh Council
  • Public Finance Minister Ivan McKee
  • Edinburgh Council leader Jane Meagher
  • VisitScotland
  • The Scotsman