Tax on tourists will make Wales ‘less welcoming place’ for visitors
FARMERS FEAR HOLIDAY LICENSING SCHEME
FARMERS and landowners have condemned plans to introduce a statutory licensing scheme for holiday cottage owners in Wales.
In recent decades, the agricultural sector has been encouraged to diversify into tourism but now it fears all this work could be undone.
The Farmers’ Union of Wales (FUW) is worried a licensing scheme could be costly and fuel an increase in empty properties. Like the Wales Tourism Alliance, the FUW also believes it is an inevitable precursor to a Visitor Levy, or tourism tax.
A licensing scheme has been proposed by the Welsh Government as a way of creating a level playing field for all accommodation providers, including those operating Airbnbs and offering temporary lets via social media.
The industry supports the idea in principle, as it is keen to drive up standards, but it believes a simpler registration scheme can weed out unregulated operators without the need for expensive licensing.
However this is predicated on effective policing, without which some businesses could operate “out of sight” in order to avoid being liable for the Visitor Levy. In contrast, licensing would enable a more comprehensive database of accommodation providers, a prerequisite for the introduction of a tourism tax.
Aberdyfi farmer Dewi Owen, chair of the FUW’s farm diversification committee, said ill-considered policies could be counter-productive not just for tourism but also for the housing sector.
In a consultation that ended last week, Cardiff wants a licensing scheme to be based on a similar model to Rent Smart Wales, the system for long-term rentals.
Mr Owen said: “This has clearly created additional barriers for landlords attempting to provide for the rented sector. As a result, many properties are being left unoccupied or sold as second homes, which is exacerbating the second home crisis.”
As well as licensing, the union is opposed to Cardiff’s tough new occupancy thresholds for holiday lets. Failure to meet them will leave providers liable to expensive council tax rather than cheaper business rates.
Farmers argue that hitting the new 182-day threshold will be “practically impossible” for many, forcing them to close down farm cottage rentals that then cannot be used for any other purpose due to Section 106 planning restrictions.
Mr Owen said: “There is a strong feeling amongst farmers who have diversified into self-catering accommodation that many policies designed with good intention to tackle the impacts of second homes and shortterm holiday lets, will have a detrimental impact on genuine providers.
“The Welsh Government must ensure that such policies do not result in an irreversible impact on the Welsh tourism industry, which in turn leads to a sharp increase in the number of accommodation providers operating under the radar. It could also lead to empty properties which cannot be used for residential purposes due to planning conditions.”
Taking a similar stance is CLA Cymru, which represents the country’s landowners.
Its director, Nigel Hollett, said now was not the time to be introducing a licensing scheme as tourism businesses grapple with a serious cost-ofliving downturn.
Among its members, a recent survey of around 100 holiday let owners found most have a modest annual margin of between £5,000-£10,000 from three-or-fewer units. More than half are farm diversifications and 80% employ staff, with little scope to absorb extra costs even during an economic upturn.
Moreover, more than 70% are having to “think again” about running a holiday let in view of the stiff new 182day occupancy target, said Mr Hollett. This figure chimes with the findings of a much bigger survey carried out by the Wales Tourism Alliance.
He added: “A licence will be a costly and onerous burden which will serve only to facilitate the introduction of a tourism tax and enable creeping regulation. It undermines the Welsh tourism sector’s competitiveness, making Wales a less welcoming place for visitors.”
Within the holiday lets sector, there is widespread dismay among longstanding providers that, in future, they could require “permission to operate” under a licensing scheme. The industry believes a database of regulationcompliant businesses is needed but it believes this can be better achieved via a statutory registration scheme as this would allow businesses to continue to trade pending checks by councils.
If licensing is introduced, it will not just affect B&Bs, hotels, cottages and chalets. It is also proposed that caravan and motorhome sites will have to sign up, along with campsites and glamping. In addition, narrowboats, houseboats and canal boats will be included too.
Exemptions may be possible. One tricky area highlighted by the caravan sector is whether pitches or caravans will need licensing. Another is the sub-letting of privately owned caravans on licensed parks. To address this, Cardiff is proposing to make whoever makes the letting - either the park owner or caravan owner responsible for obtaining a licence.
According to the Wales Tourism Alliance, in its response to the consultation, this amounts to a “fit-andproper-person” test. It said the licensing criteria should relate solely to the quality of the visitor accommodation and “not the character of the person offering it”.
The rapid rise of Airbnb holiday lettings in Wales has fuelled concerns some providers are not meeting with their statutory obligations, so undercutting established providers. By introducing consistency, the Welsh Government believes licensing can help address the impact that second homes and short-term holiday lets can have on the availability and affordability of housing for local people.
If a Visitor Levy is introduced, Cardiff hopes it will generate more money for local services and community facilities in areas of Wales most affected by tourism.
A recent consultation asked for views on plans to allow local councils to roll out the levy at their own discretion.