Western Mail

Funding approved for research as Wales tourism tax on agenda

- OWEN HUGHES newsdesk@walesonlin­e.co.uk

THE Welsh Government has now commission­ed research projects into a potential tourism tax for Wales.

Labour and Plaid Cymru are pressing on with a consultati­on on the proposal to allow individual local authoritie­s to introduce a levy on visitors. These are most commonly imposed on nights spent in hotels, B&Bs or self-catered holiday lets.

They have come under fire from the sector and Welsh Conservati­ves for the move to add taxes to the sector, particular­ly as it follows the pandemic and given the current cost-of-living crisis that is affecting households and businesses. They say it will damage the sector and lead to job losses.

Ashford Price, a stalwart of the Welsh Associatio­n of Visitor Attraction­s (WAVA), claimed the country’s planned tourism charge reflected an “anti-English” agenda despite the fact other tourism areas around the world where these taxes are in place; and

■ analysis of the demographi­cs of the proposed charge would apply to the accommodat­ion sector in Wales. any overnight visitor, regardless of North Wales Tourism chief execuwhat country they came from. The tive Jim Jones has said he found it industry brings a substantia­l eco“staggering” that the Welsh Governnomi­c contributi­on to Wales, with ment is still talking about a tourism tourism-related expenditur­e reachingta­x. more than £5bn annually in 2019, but He said: “A tax on tourism would be also puts pressure on the infrastruc­a hugely regressive step that would ture of local communitie­s. damage an industry that is already

The Welsh Government has been reeling after the pandemic.” asked to produce evidence to support Chairman of Wales Tourism Allithe move ahead of a consultati­on this ance Suzy Davies has said that a tourautumn. Now Minister for Finance ism tax would not help in creating a and Local Government Rebecca “welcome to Wales” message that will Evans has approved funding for three attract tourists to the country. research projects to support the “All tourism-tax countries have developmen­t of the tourism levy. much lower rates of VAT for tourism

They will look at: products in those countries,” she said.

■ research into the economic “But the prospect of a 20% VAT rate impacts of a tourism tax in Wales. plus the tourism tax, however mod

■ overview of the tax systems in est, is not great news for tourism in

GB, let alone Wales.

“And again, it does not help us with that ‘Wales really wants you, welcome to Wales’ message that we need to be pushing at the moment.”

Rebecca Evans, Minister for Finance and Local Government, said: “Visitor levies are a common feature in tourist destinatio­ns internatio­nally. They are an opportunit­y for visitors to make an investment in local infrastruc­ture and services, which in turn make tourism a success. Without such a levy, communitie­s face an undue burden to fund services and provisions on which tourists rely.”

Mark Drakeford, Wales’ First Minister, believes a tourism tax can help ease the burden on rate-payers, who he claims currently underwrite many of the services and facilities that visitors enjoy, from car parks to toilets.

But tourism operators point out that visitors already bring in additional money for local areas. This ranges from extra business rates from tourism-related firms to council tax premiums on second homes. There is also the Enhanced Population Grant, which allocates extra money from Welsh Government based on the number of visitors to a county. In addition, visitors also pay to use car parks and sometimes toilet facilities – directly helping to fund them.

On the research projects, a Welsh Government spokesman said: “The three projects include secondary research on the economic impacts of a tourism levy in Wales; an overview of the tax systems facing the visitor economy in selected countries; and an analysis of the demographi­cs of the accommodat­ion sector in Wales.

“The research will further build the evidence base to inform policy-making and ensure any levy brings maximum benefits for communitie­s.”

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