Tourist bed tax ‘doesn’t make sense’ for beleaguered sector, says Fiona Hyslop

Edinburgh Festival fireworks, by Michal Ziembicki​

Fiona Hyslop has given the clearest indication yet that the Scottish Government is not keen on a tax on tourism for local authorities.

A tourist or bed tax had been raised by politicians from across the spectrum before the Holyrood election to raise money for local infrastructure, with cultural organisations and City of Edinburgh Council thought to be keen.

Supporters said it could plug shortfalls in council budgets, with Edinburgh potentially raising up to an extra £10m a year by charging a £1 a night bad tax.

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However the Federation of Small Businesses in Scotland and the Scottish Tourism Alliance have lobbied against the move, calling a “regressive tax on visitors”.

In an exclusive interview with Holyrood, the Culture, External Affairs and Tourism Secretary Fiona Hyslop said the imposition of VAT on the sector from the UK Government meant the sector needed “smarter” alternatives.

“Scotland has the second highest VAT payable for the tourism industry. In that context, trying to put extra taxation on them doesn’t make sense,” she said.

“I agree with the cultural sector we need more investment to help support the infrastructure in our cities, of course we do, but there are smart ways of doing it.

“That’s what I want to do as part of my brief, to look at smart ways of getting investment we need, but do it in a way which doesn’t hammer the tourism industry.”

The full interview with Fiona Hyslop will feature in Monday’s edition of Holyrood magazine.