UKHospitality Cymru has said the current plans for a visitor levy fund in Wales are too broad and include no specific ring-fencing of funds to improve tourism.
The proposed legislation will the Welsh government says enable local authorities to introduce a visitor levy in their areas, which is a priority commitment within the Programme for Government.
The levy will be a contribution made by visitors and applied to overnight stays in visitor accommodation. It will raise additional funds for local authorities to reinvest in the public services and infrastructure that make tourism a success. Each local authority will have the power to decide to introduce a visitor levy in its area, meaning this will be a new, local levy designed in a way that works for residents, businesses, and visitors.
In its response to the Senedd’s Finance Committee consultation on the draft Visitor Levy legislation, the trade body criticised funding plans which include no reference to supporting and improving tourism with the funds raised.
UKHospitality Cymru called for:
• Specific clauses in the legislation that limit local authority spending of raised funds to areas that demonstrably, tangibly and directly benefit the tourism sector.
• The introduction of a displacement principle to ensure that proceeds from the levy are not used to replace existing funding by local authorities.
These changes are critical for Wales as a tourist destination and to offset the impact of this levy, which the Welsh Government’s own impact assessment notes could cause a reduction in the number of visitors to Wales. The same impact assessment highlights that the cost to visitors will be up to £33 million per year.
The legislation should also be amended to exempt children from the levy, which would bring Wales into line with the majority of European nations that implement a levy.
David Chapman, Executive Director of UKHospitality Cymru, said: “Throughout this process, the Welsh Government has made clear to us that it wants this levy to help local authorities and businesses in areas with high tourist numbers. Yet, there is no reference to improving tourism in how the funds can be spent.
“As it stands in this draft legislation, tourism has been sidelined and that is completely unacceptable. We are urging the Welsh Government to rectify this mistake and make clear that levy funds must be used to benefit tourism.
“Crucially, there must also be a displacement principle included that ensures levy funds are not simply used to fill council coffers and top up day-to-day spending.
“The Government’s own impact assessment makes clear the impact this levy will have on tourism – reducing visitor numbers and making trips more expensive for those who do visit.
“This legislation should do all it can to offset that and ringfencing funds to benefit tourism would be a logical place to start. We also need to see them exempt children from the levy, to ensure families, many of whom may already be on tight budgets, can enjoy holidays in Wales, rather than elsewhere.
“Hospitality and tourism businesses want to work closely with the Welsh Government to make this levy as successful as possible, and we hope our recommendations are taken on board so we can work to improve the visitor experience in Wales together.”