Edinburgh on track to become first Scottish city to introduce tourist tax

Edinburgh is on track to become the first city in Scotland to introduce a tourist tax after councillors backed key details of a draft scheme.

The visitor levy is expected to generate tens of millions of pounds a year, which will be reinvested back into the Scottish capital.

The charge will apply to paid accommodation including hotels, short-term lets, hostels and B&Bs, but will exclude stays in campsites.

The local authority is aiming to bring it into force from summer 2026, with the scheme estimated to raise up to £50m a year by 2028/29.

It will bring Edinburgh in line with other visitor hot spots, including Venice, Barcelona, Amsterdam, New York and Manchester.

A three-month consultation period will commence in the coming weeks and will seek further input from residents, visitors and businesses.

A flat 5% charge per night of the accommodation cost – capped at seven consecutive nights – has been proposed, but respondents will be asked whether that should be higher or lower.

The results will inform the final scheme, scheduled to be agreed in January 2025 to allow for an 18-month implementation period to begin.

The local authority said revenue generated will be injected into public services, city maintenance, affordable housing and preserving the capital’s cultural heritage – which includes Edinburgh’s world-famous festivals.

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City of Edinburgh Council leader Cammy Day said the levy presents an “innovative way of sustaining the sector and the city”.

He added: “It will significantly increase our ability to invest in the visitor experience and the tourism pressures we face, from keeping the city clean to responding to our housing emergency, so that everyone can continue to enjoy all that the city has to offer.

“By better supporting these services we can secure Edinburgh’s future as a top global destination.”

UKHospitality Scotland warned the levy must be kept to a “reasonable minimum”.

Executive director Leon Thompson added: “It’s concerning that an even higher levy has been proposed than the 5% in the draft scheme.

“I would urge extreme caution against setting the levy at a level which could tip the balance towards this scheme having a detrimental impact to Edinburgh’s reputation as a leading destination.

“Business costs to set up and administer the levy will be significant and it’s positive that the council has so far backed a mechanism for businesses to recover their costs.”