Should Fife follow Edinburgh in charging visitors a tourist tax?

Fife is the latest area to be exploring the idea of a tourist tax, so would it help raise money for the local sector or just turn visitors away?

Fife Council is consulting with businesses and communities across the Kingdom as it explores whether a visitor levy would benefit the area.

It follows the approval of a 5% tourist tax on overnight accommodation in Edinburgh, which will be applied from July 2026.

Tourists spent almost £340m in Fife in 2023, according to VisitScotland, with an average spend of £555 per overnight visitor.

‘It could be the final nail in the coffin for tourism’

As well as international tourists, Fife is a popular destination in the “staycation” market.

At Maggie Picken’s self-catering lodges on the outskirts of St Andrews, 90% of visitors are from elsewhere in Scotland.

“I have real concerns about a tourist tax in Fife,” she told STV News. “I know many other countries have a tourist tax but, unlike the Scottish proposal, they will only apply it to people who come from abroad – not the local resident.

“We’ve noticed quite a reduction in bookings since Covid, we’ve got a cost of living crisis, we’ve got very high taxation in Scotland and I feel this might just be the final nail in the coffin for tourism.

“I feel so lucky to live in Fife and I love bringing guests to this area […] and by doing that, we support local businesses, local activity centres and they all need that money. We all need the tourist economy.”

‘What are the public sector going to do with the money?’

For the quaint coastal towns of the East Neuk, tourism is essential.

Zaphar Iqbal runs village shops in Lundin Links and Lower Largo. Even though he would not be charging any future visitor levy, he would feel the impact of any change in tourism numbers.

He said: “We rely on summer trade to get through the winter period so I think, in terms of tourism, it would have a big effect on us if people never came.

“I’m a little bit worried about it. In terms of hotel trade – if less people come to the hotels, less people come here.”

Next door is the Crusoe Hotel which overlooks the Firth of Forth. Owner Graham Bucknall supports the idea of a visitor levy – on the condition that the money is used to promote tourism in the area.

Graham Bucknall at the Crusoe Hotel. STV News

He said: “Fife is a world-class visitor destination and we should be proud of it.

“I think, as ever, the concern is once the public sector gets the money, what are they going to do with it?

“We will see how much we’re raising ourselves from this tax […] and I think we’ll probably have a view for what we could do with that money to develop tourism.

“Often the private sector are better placed to know what to do with the money but if we can have a clear strategy from Fife Council of what they’re going to do with the money, why they’re going to do it and how they’re going to deploy it, then I’m in favour.”

‘The model can’t be a one size fits all’

There were 2.9 million nights spent in Fife’s accommodation by tourists in 2023, according to VisitScotland, bringing £338m to the economy.

The local authority says that its early research suggests a tourist tax charging 5% on overnight stays could generate between £3.4m and £8.2m each year.

Darren Trimble, a tourism lecturer at Fife College, said: “What we’ve seen since 2015 is a massive rise in the number of international visitors coming to Fife.

“That’s a lot of potential cash that could be reinvested in the area to help local businesses, infrastructure etc.

“The issue with Fife is it’s very diverse, I mean it’s a whole region rather than a city.

“We have urban built-up areas like Dunfermline, Kirkcaldy, Glenrothes. We have coastal areas in the East Neuk […] and then we have areas that are very historical and renowned around the world like St Andrews.

“I think the model can’t be a one size fits all. Fife Council have to take careful planning to make sure it’s dispersed correctly and to the areas that tourists are visiting.”

Fife Council has stressed there is flexibility over whether the charge applies to all or part of the council area, whether it is charged for all or part of the year and can change depending on the purpose of the visit.

No decision on the introduction of a visitor levy would be taken before August 2026 at the earliest.

Fife Council leader David Ross said: “There are very mixed views on the introduction of a visitor levy.

“There’s also lots to learn from others who have already introduced these schemes.

“So we will be taking the time to make sure we gather all the views and have all the facts and evidence in front of us before we make any decisions on this.”