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Tourism: Overnight Visitor Levy
15 September 2026
Lead MP
Jim McMahon
Oldham West and Royton
Labour (Co-op)
Debate Type
Ministerial Statement
Tags
EconomyTaxationTransportForeign AffairsCulture, Media & SportBusiness & Trade
Other Contributors: 40
At a Glance
Jim McMahon raised concerns about tourism: overnight visitor levy in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Statement
EconomyTaxationTransportForeign AffairsCulture, Media & SportBusiness & Trade
Government Statement
Last Thursday, the Government published their response to the consultation on the overnight visitor levy. The initiative aims to deliver good growth across the UK by empowering local leaders to introduce a levy to support growth in their regions. Visitor levies are common in Europe and G7 countries, and the Government have decided to allow both foundation and mayoral strategic authorities to raise a levy. The levy will be set as a percentage of accommodation costs, ensuring that low-cost stays remain affordable while contributing more from those who can afford it. Strategic authorities will consult before introducing the levy, and local leaders will be able to set out plans for investment by early 2028, with a levy potentially introduced before the end of this Parliament. The changes will mean more investment in high streets, public transport, and tourism hotspots, benefiting both residents and visitors.
Question
This initiative is called Labour’s holiday tax, which is uncapped and further burdens the hospitality sector with higher employment costs and business rates. It will cost British families more, potentially wiping £2 billion from the economy and resulting in up to 33,000 job losses. It impacts everyone who stays overnight for various reasons, not just foreign visitors. The Government must scrap the holiday tax.
Minister reply
The Government is not starting from year zero and has introduced measures to give pubs and live music venues a 20% business rates cut, targeting investment at town centres and high streets. The visitor levy is a choice for local leaders, who will consult and present where the investment will go. This will benefit tourism hotspots and improve services for residents and visitors.
Emma Lewell-Buck
Lab
South Shields
Question
South Shields tourism relies on families from neighbouring regions who may not come due to the additional cost. Local hospitality businesses do not want this measure. Devolution works only when it reflects community wants, so will MPs be at the forefront of these proposals?
Minister reply
I appreciate the question and recognise the championing of jobs in her community. Investment is desperately needed to improve the visitor experience and benefit local residents. If implemented correctly, everyone will benefit from the improved visitor experience.
Question
Liberal Democrats support devolving economic powers but businesses are struggling under mounting costs, a higher VAT rate, and the Government’s national insurance contributions hike. Without support, the levy risks looking like another short-term tax grab. Can the Minister confirm when the House will see full details of the levy, and will Ministers implement a cap and sector support to protect local tourism and hospitality?
Minister reply
There is no expectation that councils will see a cut. Local leaders in mayoral and foundation strategic authorities will decide if they want to introduce the levy, consult businesses, and set out where spending and investment will follow. This is genuine devolution, not central Government telling places what to do.
Question
As a Cornish MP, I welcome this measure. Will the Minister confirm that emergency and temporary accommodation, as well as low-cost holiday options such as tents and caravans, could be excluded from the levy?
Minister reply
We will certainly set out more detail on the list of exemptions as the legislation is developed. Holiday hotspots such as Cornwall benefit hugely from tourism and support a huge range of jobs, but it is right that the cost is met by a fair and proportionate levy on those who benefit. Local areas will see the benefit and the investment that will follow.
Gosport
Question
The MP is puzzled by the non-ringfenced nature of the levy and asks for evidence of its benefits and preparation for its implementation. She is concerned about the impact on hospitality businesses already struggling.
Minister reply
The minister emphasises that local areas will decide on the levy through consultation, with mayors and foundation authorities required to set out the levy amount, impact assessment, and investment plans. The levy aims to support the wider visitor experience beyond just accommodation.
Question
The MP asks about the lessons learned from other G7 and European countries with overnight levies, and the impact on the hospitality sector in Bournemouth, which has seen cuts to its tourism department.
Minister reply
The minister acknowledges the challenges faced by Bournemouth due to local government cuts. He notes that other countries may have a flat rate levy, but the UK will adopt a percentage rate to ensure fairness and proportionality.
Question
The MP criticises previous taxes that have reduced jobs and schooling, and expresses concern that a tourism tax will reduce tourism.
Minister reply
The minister argues that taxes under the previous government were high and lacked transparency, while the current levy aims to invest in improving places, thereby creating a more sustainable visitor experience.
Question
The MP is concerned about the pressures on the hospitality sector in Brighton and asks for reassurance about Government support and a visit to the seaside to hear local concerns.
Minister reply
The minister agrees to visit seaside towns and highlights the importance of investing in the visitor experience to support growth in the sector, despite current challenges.
Question
The MP questions the timing of the levy during a cost of living crisis and the impact of VAT rates in Torbay compared to other European countries, and asks about the inclusion of Airbnb operators.
Minister reply
The minister confirms that local impact assessments will be conducted and that the levy will apply to all accommodation providers, including Airbnb operators, to ensure fairness.
Question
The MP welcomes the levy and asks for assurances that 50% of the funds will return to the borough in London, to support local businesses.
Minister reply
The minister acknowledges the importance of local flexibility and collaboration between local government and regional mayors to ensure investment in local needs and services.
Desmond Swayne
Con
New Forest West
Question
The MP questions the winners and losers of the levy, given the lack of clarity on the levy amount and its levying areas.
Minister reply
The minister explains that the framework allows for local decisions on the levy, with the aim of promoting investment and growth in the tourism sector.
Rachael Maskell
Lab
York Central
Question
The MP asks for the levy to be hypothecated to York to support the local tourism industry and services.
Minister reply
The minister suggests that local leaders will need to decide on how to design the scheme, with the expectation of partnership and collaboration between local authorities and mayors.
Question
The MP confirms that Hull and Greater Lincolnshire will not impose the levy and invites holidaymakers to visit these areas to save money. He asks for a guarantee that the Government will not impose a national levy.
Minister reply
The minister emphasises the benefits of devolution, where local leaders decide on the levy and are accountable to the public for its success or failure.
Anneliese Dodds
Lab
Oxford East
Question
Oxford is a great place to visit, and many local residents and businesses welcome tourism but also recognise the additional costs. They want to see a levy to improve the local environment for tourists and local people. Will the Minister persuade Oxfordshire county council to back a mayoral strategic authority to get on with it?
Minister reply
Our devolution programme is ambitious and aims to widen across the country and deepen, ensuring mayors have the tools and levers to get the job done. We are up for having local conversations to progress devolution.
Question
5 million people visit East Yorkshire every year, and any tourism tax would have a devastating effect on the local economy. Can the Minister guarantee that any money raised in towns such as Bridlington or Hornsea will be spent there, rather than in a larger conurbation like Hull?
Minister reply
There is no intention to introduce an overnight visitor levy in the area for the foreseeable future. In the spirit of devolution, local authorities should be trusted to do what they believe is right for their area, but they will need to present their plans through consultation and impact assessment.
Question
As a Cornish MP, I am proud that this Government were elected on a platform of devolution, trusting local authorities to raise an overnight levy if they see fit. Does the Minister agree that fiscal devolution is essential for moving powers and funding out of this place and directly into the hands of local people?
Minister reply
Fiscal devolution is really exciting, and local authorities need resources to get things done. The overnight visitor levy is part of a package of fiscal devolution that the Government has been waiting for.
Question
Stratford-upon-Avon is a visitor destination that attracts millions of visitors each year, supporting local businesses and jobs. Will the Minister commit to ensuring that any future levy is subject to meaningful consultation with the sector and local residents, and to the transparent ringfencing of revenues for investment in the local area?
Minister reply
The levy is seen by many local authorities as a big prize to invest back into the local economy. The APPG for hospitality and tourism has spent time going through the arguments for and against the levy and examining its benefits.
Question
In order for my constituents to feel the difference, money generated in Scarborough and Whitby must be spent locally, not in York. Will the Minister ensure that locally generated revenue benefits the communities that produce it?
Minister reply
It is in the spirit of devolution that local areas will decide where the revenue is spent. The Minister spent the summer near Richmond, in north Yorkshire, and had a fantastic experience.
Question
The Government’s plans for a tourist tax will be terrible for the visitor economy, jobs, and spend on the high street. Will the Minister include in his visitor economy growth strategy a full analysis of his plans and publish it before introducing the tourist tax?
Minister reply
The impact assessment must be done in areas where the levy has been introduced. Until we know where it has been introduced, we cannot do a national assessment of the impact.
Question
Edinburgh is the third biggest ticketed event in the world and has implemented a 5% visitor levy, raising £50 million to invest in the local economy. Despite its implementation, ticket sales increased by 8% this year. Will the Minister meet me and officials from Edinburgh to understand their learning from the visitor levy?
Minister reply
The Minister would be pleased to meet and receive the evidence base from Edinburgh. In Manchester, there is a voluntary scheme through the business improvement district that agrees if we have money to invest in the visitor experience and events, everyone benefits.
Question
Those working in hospitality across Yeovil have told me that a tourism tax will impact jobs, growth, and high streets. We want to encourage tourism, not decrease it. Will the Minister meet me and representatives of the sector to talk about how we can boost tourism in rural Somerset?
Minister reply
The Minister believes that the measure will impact jobs, growth, and high streets in a positive way because better investment and an improved visitor experience will create more jobs and growth. The Government has been reinvesting back into many parts of the country that have been neglected.
Question
May I ask the Minister about how the tourist levy has been put in place in other G7 countries, and what he has learned from them?
Minister reply
Some form of local sales tax or visitor overnight accommodation levy is generally accepted as part and parcel of going away. A visitor levy has to be in line with the overnight rate that people are paying, to ensure low-cost family accommodation remains as such.
Julian Lewis
Con
New Forest East
Question
If the New Forest and the Waterside were forced into a unitary authority dominated by Southampton and Eastleigh, what chance would there be of local authorities looking after the interests of rural areas?
Minister reply
In the right hon. Gentleman’s case, this will be led by the mayoral strategic authority. It will be for that authority to do the consultations, carry out the impact assessment and, importantly, decide on the investment plan.
Deirdre Costigan
Lab
SL
Question
Southall Broadway attracts wedding shoppers from across the globe, so local businesses welcome the overnight visitor levy as a great opportunity to get investment in the town centre. However, unlike other mayoral areas, London is not a combined authority. What can the Minister do to ensure that is reflected in the design of the levy in London, so that the mayor and London boroughs can jointly shape how it operates, and places such as Southall do not lose out because they are in London?
Minister reply
We accept that the London devolution settlement is different from the settlement elsewhere in England, because of the relationship between the mayor with executive powers and the Greater London Authority as a directly elected body. However, there is an expectation that all partners—including local authorities, the GLA and the mayor—will work together in partnership on this and other measures.
John Glen
Con
Salisbury
Question
Nine years ago, when I was the tourism Minister, I resisted the English holiday tax. What concerns me now for Salisbury—where people like Brian Currie are investing millions of pounds in the Cathedral hotel—is the impact that tax will have on domestic tourists. People in this country who cannot afford to go abroad will now be burdened with additional costs to have a few days away in England. Has the Minister understood the distribution of the burden of this tax and the impact it will have on people in this country?
Minister reply
The right hon. Member is making the case for the importance of the percentage rate approach. It is fair to say that large parts of our tourism economy provide a low-cost but good-quality family experience, and with a percentage rate those businesses will pay proportionately less than hotels in the capital, which is right and proper. It will also be a requirement that all areas carry out an impact assessment to understand the impact on their local economies and present where the investment will go afterwards.
Noah Law
Lab
Cornwall
Question
Any devolution of powers, investment or fiscal policy down to Cornwall is welcome. That is why I am pleased our Government are progressing to give us the power to raise a visitor levy, whether or not Cornwall council chooses to utilise it. As the Minister might expect, however, from a Member who represents an area with a significant visitor economy, my expectation is that that money should be invested not only well but to support the common goods on which businesses in that sector and the communities they operate in rely. Can the Minister assure me that the manner in which the levy will be raised will be flexible, so that local leaders can use it in a way that is appropriate to the area and the money does not recycle back into Cornwall council’s pot?
Minister reply
I think that is the key. Some of the tensions in the Chamber are the result of parliamentarians wanting to know the full detail as it will apply across the country, but that is not devolution. Devolution means allowing local flexibility and allowing local leaders to make choices in the way that my hon. Friend has set out.
Bolton West
Question
Several times, the Minister has referenced other European countries having a tourist tax, but as my hon. Friend the Member for Torbay (Steve Darling) highlighted, those countries have much lower tax rates for hospitality overall. Will the Minister commit to reducing VAT on hospitality? Secondly, on the tourist tax, will he clarify whether the levy will be listed separately to the price of the room, so that those who use those facilities have clarity and transparency?
Minister reply
We are still working through the detail of the collection and reporting processes. Part of that consideration will be the presentation on bills, although let us not forget the 20% business rates support we are introducing for pubs and live music venues, which is the first step in supporting hospitality in the round.
Josh Newbury
Con
Cannock Chase
Question
I recently had the pleasure of visiting the Beaudesert outdoor activity centre in Cannock Wood, which welcomes 50,000 young people a year—including scouts, guides and school groups—and gives them memories to last a lifetime. It is a charity; it keeps charges low, and it worries about anything that could make its offer cost-prohibitive to cash-strapped groups. Given this Government’s commitment to expanding life chances and experiences for young people, will the Minister consider exempting groups of under-18s, to ensure that those valuable experiences do not become less affordable for them?
Minister reply
My hon. Friend raises a fair point, and one that I will take away.
Greg Smith
Con
East Cambridgeshire
Question
I am sure that many of my constituents considering a UK break will look to Cambridgeshire, where the always fiscally sound Conservative mayor Paul Bristow has made it clear that now is not the time for such a tax. However, hospitality businesses across the rest of the country will be frightened by this measure—we already have two pubs closing a day, and businesses are struggling to get by under this Government’s tax burden. How low does tourism in this country have to dip, or how many businesses have to go bust, before the Treasury tells this Minister that this tourist levy must go?
Minister reply
In the spirit of devolution, if a mayor believes that not introducing a visitor levy is the right decision for their area, the Government will support that. To be clear, though, the last Conservative Government was not a good period for our pubs and hospitality businesses—pubs in our communities, town centres and city centres closed at a rate of knots. We are trying to say that that decline is not inevitable, and that Government working in partnership with our regions and councils can begin to turn that around.
Danny Beales
Lab
Hillingdon
Question
Every year, millions of people travel through Hillingdon, to visit the country or the city of London or go to Heathrow, and stay at hotels near the airport. That creates real costs for local communities—policing, street cleaning and transport impacts—and addressing those threats to the tourist economy requires funding. As such, I support this measure, but can the Minister assure me that those issues that are often locally driven and funded will also get support in a mayoral-led system?
Minister reply
It will be for local areas to determine how they frame both the levy and the investment. In the case of London, the mayor will be working with the GLA. There is an expectation that councils will be collaborated with and that there will be some agreement on how that might work in practice, but as I say, it is for local areas to work through that detail.
Mark Pritchard
Con
The Wrekin
Question
We now have a Minister for euphemism. Let us be clear: this is not a visitor levy, but a tax on tourism. It is a tax on the staycation, a tax on hospitality, a tax on the family holiday, a tax on hospitality jobs, a tax on mobility, and—the worst sin of all—a tax on Shropshire. Shropshire tourism rejects this tax whenever it might come, directly or indirectly. Is this not another example of this Government being addicted to raising taxes?
Minister reply
The only things we are determined to do are to ensure that devolution means something—that local leaders must be given the tools they need to do the job at a local level—and not to accept that the decline of our towns, cities and rural communities is inevitable after our experience under the previous Government. We think there is a different way.
Jonathan Davies
Lab
Montgomeryshire
Question
Many people visit Derbyshire because it has beautiful scenery and a fascinating history, but those visitors do place a strain on our infrastructure, which is why I think it is reasonable that we explore whether we continue to ask local people to foot the bill for that. However, I recently visited Drum Hill scout camp in my constituency, which welcomes many thousands of young people from quite far afield to learn fantastic life skills, and I have also engaged with organisations that provide respite holidays for disabled people. I know that local leaders can decide how to implement the legislation locally, but can we put an exception for those kinds of groups on the face of the Bill?
Minister reply
As I said in response to a similar question, my hon. Friend makes a fair point about that type of accommodation, and I reflect on the work of Claire Ward as the Mayor of the East Midlands. There is a lot of focus now on creating good jobs, and for that to be in a spirit of devolution, with mayors wanting more control of what happens in their areas. This measure, alongside business rate retention and income tax retention, is beginning to address that balance.
Ben Obese-Jecty
Lab
Huntingdon
Question
In Cambridgeshire, the Conservative Mayor Paul Bristow, decided not to implement this tourism tax. That is incredibly important, because we have recently adopted the local visitor economy partnership as we seek to make gains from the creation of Universal Studios just down the road. My hon. Friend the Member for Mid Bedfordshire (Blake Stephenson) is looking to bring in an LVEP in Bedfordshire, too. Why does the Minister think that a tax like this would benefit somewhere like Cambridge, when we clearly do not think that it will? What else is he doing to support communities such as mine in Huntingdon, where we are looking to build a visitor economy to take advantage of the opportunities that Universal Studios can bring?
Minister reply
This Government have given support to Universal Studios, because of the economic benefit that will bring. It will also be a nice thing for visitors from across the country to be able to go there and enjoy that. It will have a wider impact on the local economy that will benefit hospitality, leisure and accommodation providers. In response to the point that the hon. Gentleman makes about place-based investment, this Government have an ambition to ensure that every town centre and every high street realises its full potential. That needs investment, too, and he will see that not just in his place, but right across the country.
Elsie Blundell
Lab
Heywood and Middleton
Question
As the proud Member of Parliament for Heywood and Middleton North in Greater Manchester, I, too, want to see the prosperity of the centre flow out into towns like mine, which are just as deserving of economic development and cultural regeneration. Does the Minister agree that extending further revenue-raising powers to our mayors will accelerate the regeneration that we need to see in our constituencies, just as much as in the city centre?
Minister reply
My hon. Friend is a fantastic champion for her place, and she also recognises that within our city regions, as much as everywhere else, every community has a role to play. She will know the work done by the fantastic Middleton Arena. With more investment and more footfall, all our places—whether Middleton, Oldham or Greater Manchester more widely—can do even more.
Caroline Voaden
unknown party
unknown constituency
Question
As vice-chair of the all-party parliamentary group for hospitality and tourism, I have sat through several evidence sessions on this visitor levy, and I have yet to hear any operator in the sector say that they support it, so I do not understand to whom the Minister has been talking. A caravan park operator said that if numbers go down in the off-season, they will only be able to be open in the high season, which has a knock-on effect on jobs, the local pub and the local café. It has a ripple effect across the local economy. The Minister talks about growth, and we need growth in the sector, because young people primarily are employed in hospitality. Such jobs are vital for young people. Can he tell me in what world he sees the tourism and hospitality industry growing under this visitor levy?
Minister reply
For the reasons I have stated many times before, if we invest in and grow our tourism and hospitality economy, that will generate more footfall, people will enjoy their stay more, and that will create more jobs, including for young people.
Alicia Kearns
unknown party
unknown constituency
Question
Whether it is parents requiring a hotel stay while their four-month-old daughter has neurosurgery, or a new mother requiring a hotel stay to recover from a pulmonary embolism, in both those cases a tax would be incurred for a stay they wish they did not have to do. Those are not hypothetical examples; I was both. Will the Minister please mandate from the Dispatch Box that anyone seeking medical treatment for themselves or their children—sometimes that can be months at a time at Great Ormond Street—will not have such a tax imposed on them and their families?
Minister reply
I can certainly commit to look into it and to respond to the hon. Member in writing.
Richard Foord
unknown party
unknown constituency
Question
Businesses in Devon have told me of their concern about this proposed visitor levy, including Littlecourt Cottages in Sidmouth. They point out that the tourist footfall might decrease, not just for the cottages, but for the restaurants, the attractions and the shops in the local area. This tax has been dreamed up on the basis of what it will do for cities that see a higher proportion of wealthy overseas visitors, has it not?
Minister reply
Of course it has not. First, devolution will be rolled out across the whole country, and significant rural areas are already covered by mayoral strategic authorities. That roll-out will include foundation strategic authorities, which covers places such as Cornwall. As part of the next stage of devolution, we are seeing a grow-out across the south of England and the east of England that will see more coverage. Fundamentally, it is for local leaders and local mayors to get together and work out what is right for their area.
Matt Vickers
unknown party
unknown constituency
Question
At the weekend, I had the pleasure of joining Cleveland scouts and seeing at first hand the fantastic work that scouting does to give young people confidence, practical skills, friendships and opportunities they might not otherwise have. Can the Minister reassure those young people and their families that this Government are not seriously proposing to tax a scout for pitching a tent? Can he confirm that scout camps and other charitable youth residentials will be exempt from his holiday tax?
Minister reply
That question is in line with a number of other questions that have been asked about youth experience accommodation. I have committed to go away and look at that.
Jim Shannon
DUP
Strangford
Question
Many of my constituents in Strangford and people across Northern Ireland travel to the United Kingdom for a home-based holiday. The weather is almost as good as it is in the Mediterranean. They pay for their flights or they take their vehicles on the ferry, already paying a high fee to support tourism in the United Kingdom. Why should my constituents—British constituents—be penalised twice for supporting and buying into a British holiday? What steps will the Minister take to ensure that those in Northern Ireland are not discouraged from contributing to having a home-based holiday in England?
Minister reply
Everybody will pay the levy, and they will benefit from the improved experience, not only in the immediate area, but in the types of events and activities that might draw in people. Where local leaders decide that the levy is right for their places, we believe that people will enjoy the wider benefits.
Shadow Comment
Rebecca Paul
Shadow Comment
This initiative is referred to as Labour’s holiday tax, which is uncapped and will further burden the hospitality sector already affected by higher employment costs and business rates. The tax will cost British families more for weekend getaways and holidays, potentially wiping £2 billion from the economy and resulting in up to 33,000 job losses. It is not just a tax on foreign visitors but on British families, impacting everyone who stays overnight for various reasons. The Prime Minister has promised to give breathing space to households struggling with the cost of living, but this tax does the opposite. The Government must scrap the holiday tax.
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