UK Domestic Visitor Levy

Lord Sharpe of Epsom Excerpts

Monday 16th March 2026 Lords Chamber

Asked by

[Lord Sharpe of Epsom]

To ask His Majesty’s Government what assessment they have made of the impact of introducing a visitor levy on the cost of domestic travel and holidays within the United Kingdom.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, the precise design and scope of the visitor levy power is still under development. Our consultation closed on 18 February and the Government will publish our official response in due course. Mayors will need to decide whether to implement a levy and, if so, consult on specific proposals. This will inform their decisions regarding whether and how a levy will be applied and how any revenue is invested. Evidence from international schemes suggests that modest rates have a minimal impact on visitor numbers. Improved destinations and visitor experiences may also offset price sensitivity over time.

[Lord Sharpe of Epsom (Con)]

My Lords, I am grateful to the Minister for her Answer, but the facts in this country are probably a little different from those she has given. According to the World Economic Forum’s travel and tourism development index, the United Kingdom currently ranks 113th for price competitiveness. A soon to be published Oxford Economics study suggests that, even under the most benign visitor levy scenario, which is a £2 per room per night charge, the effect in 2030 would be millions fewer nights in paid accommodation, nearly £0.5 billion less in total tourism spending and thousands of fewer jobs. Given those figures, why are the Government contemplating a holiday tax at all?

[Baroness Taylor of Stevenage (Lab)]

I certainly agree with the noble Lord that the Government want to see the tourism economy in Britain reach its full potential. The decision on whether to introduce a levy will be for mayors, and they will need to consult ahead of making those decisions. As a mayoral power, the ability to create a visitor levy will ensure that those with the best understanding of their region can tailor investment towards growing the local economy, whether that be in tourism or other areas, bearing in mind its needs, including those of the accommodation sector. This puts the power back in the hands of mayors to develop their own tourism economy in the way that they see fit, and it may lead to new visitor attractions and better quality of accommodation.