THE PM faced fury tonight after approving plans which will drive up the cost of a UK holiday.
Andy Burnham announced plans to let England’s 14 regional mayors impose an uncapped levy on overnight stays, dubbed the “tourist tax”.
Tourism chiefs blasted another ‘kick in the teeth’ by the Labour Government Credit: Alamy
Andy Burnham announced plans to let the England’s 14 regional mayors impose an uncapped levy on overnight stays, dubbed the ‘tourist tax’
Labour’s ten said they would cap the charge at five per cent of the cost of a break at hotels, B&Bs and other accommodation — potentially costing families hundreds.
The two each from Reform and the Tories seem sure to oppose the PM’s move.
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And hospitality and business chiefs — already reeling from increases to Employer National Insurance and the minimum wage — say the tourist tax could lead to a jobs bloodbath.
They warn of 33,000 roles disappearing, £2billion wiped from the economy and a £1.6billion hit to holidaymakers.
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COAST OF LIVING
Families face tax hell on ‘great British holiday’ as 33,000 jobs face axe
The levy is due from 2028 and will be optional but Brits and overseas visitors will be clobbered in those areas which adopt it.
It comes despite Mr Burnham repeatedly promising to give voters “breathing space” from rising bills.
Tory leader Kemi Badenoch said yesterday: “Labour’s answer to everything? Tax more. Hotels already face 20 per cent VAT. Now they’ll face VAT on Labour’s tourism tax. That means higher costs for businesses and families.
“A Conservative Government will cut tax, back business and support the Great British Holiday.”
Labour said they would cap the charge at five per cent of the cost of a break at hotels, B&Bs and other accommodation — potentially costing families hundreds Credit: Alamy
The levy is due from 2028 and will be optional but Brits and overseas visitors will be clobbered in those areas which adopt it Credit: Alamy
Reform UK’s Treasury spokesman Robert Jenrick added: “This makes a mockery of Burnham’s claim he cares about the cost of living. No Reform mayors will be screwing working people with a holiday tax.”
No10 insisted that local leaders will be encouraged to act in a “proportionate way” when bringing in the levy.
The Government insists that charging the levy as a percentage will protect staycations — but budget breaks such as The Jattvibe’s £9.50 holidays could still be hit.
Local leaders will have the powers to be flexible and offer exemptions such as campsites as part of the devolution drive.
Cabinet Minister Angela Rayner was at No10 North in Manchester to discuss the plan remotely with regional mayors yesterday.
The revenues raised will allow mayors to spend the cash on high streets and public transport, similar to what happens in cities such as Paris, Rome and Venice.
New legislation will be introduced to bring in the levy.
Allen Simpson, the boss of UKHospitality, said: “The millions of families who will be forced to pay significantly more for their holiday will hardly be comforted by their money going to prop up local government, when they’re struggling to make ends meet.
“The 33,000 people who could lose their jobs as a result of this tax, during an employment crisis, will be rightly furious.
He added that the levy in Edinburgh was “already having damaging effects”.
Jon Hendry Pickup, chief executive of Butlin’s, said: “Big cities may welcome these mayoral powers, but treating every destination and hospitality business the same will leave resorts like ours to shoulder the burden.
“Giving mayors the power to impose a levy without a national upper limit takes those concerns to another level and risks making family holidays less affordable, damaging demand and making it harder for businesses to hire young people.”
Stephen Cassidy, of hotel group Hilton UK & Ireland, said the decision will “further stifle job creation and investment”.
He added that the move was “a catastrophic blow for the UK hotel sector that is already under significant pressure”.
Alice Jeffries, from the Confederation of British Industry, said there is a risk of the rates shooting up in future.
She said: “Holidaymakers face varied and potentially high rates now, and the uncertainty of rate-creep later is a real risk that has already materialised in other countries like France and Spain.”
Tina McKenzie of the Federation of Small Businesses said: “Imposing an uncapped visitor levy in England is a kick in the teeth for the hospitality industry, at a time when small businesses are dealing with a deluge of cost rises.”
Last night a political dividing line was opening up on the issue.
Dame Andrea Jenkyns, Reform UK mayor for Greater Lincolnshire, whose area covers popular Skegness, said: “I vehemently oppose the levy/tourist tax.
“As a regional mayor I will never implement this. To businesses and local people, I have your back.”
Paul Bristow, the Tory mayor of Cambridgeshire and Peterborough, said: “The economy is struggling — hospitality is being impacted by NI rises, business rate hikes and other costs. This is not the time to put extra costs on staying overnight in Cambridgeshire and Peterborough.
The move comes despite Mr Burnham repeatedly promising to give voters ‘breathing space’ from rising bills Credit: AFP
Working families will feel the bite
By Jon Hendry Pickup (Butlins CEO)
FOR 90 years, Butlin’s has been about giving working British families an affordable Great British break.
That’s why I find the Government’s proposed holiday tax so difficult to understand.
This is a UK tax on UK people wanting to holiday in the UK, hitting those who can afford a holiday the least, the hardest.
We were concerned enough when the discussion was over 5 per cent or £2 per person a night.
Now we’re being told mayors could set a percentage levy with no upper limit, taking those concerns to another level.
The Government says it will protect budget holidays but it is still an extra cost on a family choosing to holiday in the UK.
Last year, over 45,000 people booked one of our term-time breaks for £49 for a family of four.
Even small increases matter when families are deciding whether they can afford a holiday.
Making them more expensive risks damaging demand and investment.
And taxing working British families for holidaying in Britain feels like the wrong answer.
“Overnight visitors use pubs, restaurants and visit attractions. We need them!”
Unsurprisingly, Labour mayors seemed enthusiastic about the plans.
They have committed to a five per cent cap on any tourist tax in their areas, calling it a “reasonable ceiling” and “reflective of international practice” in a letter to Ms Rayner and Chancellor John Healey.
Announcing Mr Burnham’s proposals yesterday, Ms Rayner said: “Our amazing towns and cities, and our picturesque rural and coastal communities welcome millions every year — local leaders should have the power to make the most of that popularity.
“This measure will give mayors the choice to raise and reinvest funding where it’s needed most.
“It will help support the local services, public spaces and attractions that both residents and visitors rely on, with decisions taken by people who know their area best.”
‘Look who it will hit’
Choice Hotels employs 350, has 538 rooms in five hotels and 30,000 guests a year
EDDIE Nelder has run hotels in Blackpool for more than 40 years but the tourist tax means he now fears for the future of his family business.
Eddie began at 13, learning hospitality with his dad. Now Choice Hotels employs 350, has 538 rooms in five hotels and 30,000 guests a year.
He said the tax is hard to swallow after PM Andy Burnham’s promises to revitalise northern communities and traditionally left behind places.
Eddie said: “Blackpool is a working man’s holiday, isn’t it?
“And they’re the people getting hit. It’s crazy.”
Last month, rising costs meant Choice was £200,000 down. Eddie, 62, said the Government “must understand people are losing their jobs, it’s crippling the town”.
He also questioned if a levy that works in a city made sense in Blackpool.
He said: “You can’t apply the same logic to my style of hospitality.”
‘Absolute disgrace’
George West thinks the holiday tax will leave families out in the cold Credit: ©Chris Balcombe
FARRIER George West thinks the holiday tax will leave families like his wondering if they can afford breaks.
The 37-year-old enjoys The Jattvibe’s money-saving holidays from £9.50. He said: “People work long and hard to go on a holiday and this latest tax is an absolute disgrace.
“No wonder hard-working people are fed up with how things are going — being taxed at every turn.”
George and wife Sammy, 33, enjoy UK breaks with their four children — George Jnr, 11, Noah, ten, Adele, six and three-year-old Carlos.
Their last getaway was at the Parkdean Resorts Sandford Holiday Park in Poole, Dorset — a few miles from their home in Dorchester.
He said: “Many resorts are very seasonal and rely on tourists to keep the businesses going. If the tax comes in, those who scrimp for a break will have to think twice.”
