Public given say on whether to introduce Highlands tourist tax

Highland Council has begun a public consultation on a proposed tax on tourism.

It estimates that a 5% level of “visitor levy” on accommodation costs will reap an annual income of more than £10m.

The money will be reinvested in the sector to improve services.

A committee unanimously agreed to proceed with a three-month public consultation – prompting a mixed response from accommodation providers.

There is wide agreement that investment in basic infrastructure and repairs to heavily used tourist routes need urgent attention.

However, some hoteliers and self-catering operators have urged the council to tread carefully.

Fiona Campbell of the Association of Scotland’s Self Caterers said: “Other destinations don’t have a VAT level of 20%. So, if Highland Council is looking at a 5% visitor levy – which is very, very high – then we are technically looking at a 25% tax.

“And, of course, we’ve seen that short-term let licensing has been far from plain sailing.”

Tony Story, who owns the Kingsmills and Ness Walk hotels in Inverness, said: “The 5% is not a question of simply adding 5%. There are inflationary increases.

“I estimate hospitality inflation to be running at at least 5%-7%. So, for us to stand still, we’re talking about at least a 12% increase in our room rates, which our client base will not accept. This is not a tourist tax. This is a business tax.”

Some councillors concede the new levy could prove an administrative nightmare, but those paving its path say there is a long way to go, and all such concerns will be fully addressed.

Ken Gowans, the council’s economy and infrastructure committee chairman, asked: “Would it harm their business? Well, any evidence that we have from similar schemes across Europe has not evidenced that.

“So, I would wait and see what happens. But I really don’t think that would be the case.

“In terms of the number, we’ve had to come in with a number as part of Scottish Government guidelines. We came in at 5%. It could be three, it could be eight. It just depends. That’s why we have the 12-week consultation.”

Jane Slaughter, who owns self-catering accommodation at Pinewood Steading near Beauly, said: “It’s not just accommodation providers and overseas guests that it will impact but locals – Scots – who will decide to stay and travel and tour within Highland.

“They’ll be hit by the levy at a time when things are really quite tough for a lot of people.”

People can respond online or by post. The council has promised that the feedback will shape a paper that will go before a full council meeting next March.

If agreed, the earliest the scheme can be implemented is autumn 2026.