Proposed Visitor Levy

Debate between Julian Smith and Damian Hinds

Wednesday 25th March 2026 Westminster Hall

[Damian Hinds]

Mr Efford, that really was my next sentence, because there are questions about short-term lets, and about second homes in Cornwall and so on. On the short lets issue—whether rents are being pushed up is sometimes another concern with short lets—this levy is not going to solve that problem. The Government will need to do something structurally different if they want to address those short lets questions.

[Sir Julian Smith (Skipton and Ripon) (Con)]

UKHospitality talks about this tax being

“the wrong policy at the worst time”.

One of my worries is that entrepreneurs in the tourist industry in North Yorkshire and elsewhere are on their knees due to post-covid issues, national insurance, rates and a whole range of factors. Would my right hon. Friend agree that, whatever the merits of this policy, the levy must be paused until those businesses are back on their feet and start investing again?

[Damian Hinds]

I do agree. My right hon. Friend and I have been in multiple debates in the main Chamber talking about exactly those issues, both for tourism and for the wider hospitality sector.

There are some arguments in favour of an overnight visitor levy, some of which have come up already. The main one is summed up in the sentence,

“Visitor levies provide local government with a financial incentive to grow the visitor economy.”

That has truth to it, and there is definitely an argument for making hospitality more hospitable through more investment in the visitor economy—in facilities, events, policing and so on. The sector needs more money going into sales and marketing if we are to realise our potential, so there might be an argument for this measure if the money were truly ringfenced—if it were only being spent on truly incremental items. Even then, we would still get the problem where hotels over quite a wide area pay it but the events, attractions, extra policing and so on all take place somewhere else. That might apply in Hartlepool, for example, as has been mentioned. It will certainly be the case in London—a hotel in Brent Cross is not going to feel the benefit of some extra things being put on in theatreland in the west end.

Of course, though, the money will not be ringfenced. Even if it is nominally ringfenced in year one, do we honestly believe that in year five it will still be ringfenced? Of course it will not.