A Bristol tourism tax could have a “devastating effect” on businesses and deter visitors from coming to the city.
The outcry follows reports that a tourism tax should be introduced to help plug the council’s deficit, which, due to financial oversight and dwindling central government contributions, means Bristol City Council is facing a £108million deficit by 2023.
If introduced, it would mean a small per night charge for visitors staying in accommodation. But businesses and industry bodies have warned the tax would undermine work encouraging people to visit Bristol.
However experts in the sector are saying if it was introduced, Bristol would be labelled the tax city and hit not just the tourism industry, but other businesses including, hotels, pubs, shops, cafes and visitor attractions.
Mark Payne, chairman of the Bristol Hoteliers Association said: “Quite why Bristol is putting its hands up and saying we possibly want to introduce a tourism tax is quite remarkable.
“It will give potential visitors, both business and leisure, additional reason not to come here. Add in the lack of direction on the potential new arena means people will have even less reason to visit.
“Being one of the first cities in the UK to introduce a tax on tourists would be detrimental. We already lag behind, London, Liverpool, Manchester, Birmingham and Oxford which encourage more visitors than Bristol, so why put people off coming here.
“If Bristol does go ahead and places such as South Wales don’t, then that area will be viewed as being more attractive.
“Just look at the restaurant sector. There are venues closing down on a weekly basis. The fact is we don’t get enough footfall in the city to sustain restaurants over a weekly basis, and should be encouraging more footfall not turning it away with a regressive tax on individuals looking to stay overnight.”
According to Mark one area that should be a major focus is properties that rent out rooms on Air BnB.
He added: “Putting a tax on hotels will encourage more people to stay in AirBnB. Presently there are between 500 – 1500 active rooms for sale on AirBnB in Bristol, the highest for a city outside of London. These are unregulated, don’t pay business rates, don’t employ people or pay any tax. Our view is that the council should set up a bespoke Bristol Air BnB tax, not hit tourists who are here to spend.”
Mark is also warning the authorities to be careful what they wish for citing the famous example in New York where, following the introduction of a tourism tax, resulted in the convention business halving in size within five years. This cumulated in a boycott of the city by conferencing and organising companies.
He said: “Local businesses already pay into four Business Improvement Districts, (City centre, Broadmead, Clifton and Bedminster) which currently creates £1.2 million a year for items such as cleaning, security at night, the removal of graffiti and paying for Christmas lights. So we are already coming together as businesses to alleviate some of the areas the council currently cannot fulfil and fear it won’t stop.
“On a macro scale the UK charges the highest rate of Tourism Vat in Europe. In a recent study by “The world economic forum” on international tourism competitiveness, they ranked the UK 140th from 141 countries. The ranking was primarily due to the level of tax that visitors pay. Whereas most European countries operate a reduced VAT rate on the main component of visitor expenditure (accommodation, restaurant meals attractions) the UK charges full rate of 20 per cent VAT against a European average of 10.3 per cent.
“In addition the UK has one of the highest rates of fuel duty in the world (which impacts on domestic visitors) and the highest rate of air passenger duty in the world (which impacts on Inbound visitors) – so why on a micro level would we hinder ourselves further by being the most expensive city in the UK? It just doesn’t make sense.”