Senedd Cymru | Welsh Parliament
Y Pwyllgor Cyllid | Finance Committee
Bil Llety Ymwelwyr (Cofrestr ac Ardoll) Etc. (Cymru) | Visitor Accommodation (Register and Levy) Etc. (Wales) Bill
Ymateb gan Mike Gutteridge | Evidence from Mike Gutteridge
(We would be grateful if you could keep your answer to around 500 words).
I believe that it is important that tourism should contribute to the local economy but it is important that any legislation does not have the unintended consequence of harming the low cost, non-profit sector of tourist accommodation within Wales.
The Regulatory Impact Assessment is set out in Part 2 of the Explanatory Memorandum (https://senedd.wales/media/g5ipwvwh/pri-ld16812-em-e.pdf). This includes the Welsh Government’s assessments of the financial and other impacts of the Bill and its implementation.
(We would be grateful if you could keep your answer to around 500 words).
I am concerned that there are a number of barriers to implementation:
Scope: ambiguities within the definition of ‘visitor accommodation’ make it unclear whether the bill is targeted at non-commercial providers, causing confusion and unintended consequences. It was clarified to us by [redacted – named Welsh Government official], Visitor Levy Policy officer, that the levy applies to overnight stays provided ‘in the course of business or trade’, irrespective of the type of organization (e.g., private companies, charities, or non-profits). It is still unclear to those seeking to understand the potential impact of the bill what constitutes operating "in the course of trade or business." For example, would a mountaineering club hut charging a nominal fee to cover maintenance costs and utility bills qualify as a business? This distinction needs clearer guidance to avoid unintended inclusion, and ambiguity could lead to inconsistent applications of the levy.
Administrative burden: should they be captured within the bill and required to levy fees, our volunteer run, mountaineering club hut receives payment for stays on an honesty basis after the conclusion of the stay. We will struggle to meet 30-day return and payment deadlines. This is not adequately addressed within the bill or its accompanying documents. It contrasts with charity commission timescales, which are 10 months for reporting. Unfortunately many volunteer-run accommodations lack the administrative capacity to fulfil the requirements of the bill as it stands. The resource, time, and financial requirements involved will be prohibitive for many and cause them to close.
Finance: we are all volunteers and do not hold the accounting expertise or financial resources that a commercial provider would hold. This means that the cash-flow requirements of the levy can create burdensome and complex conditions for us who are not trained to create or maintain the procedures needed to correctly report and collect the levy fees.
Equity of levy rates: The flat-rate structure disproportionately impacts low-cost accommodations without sufficiently accounting for their limited revenue generation compared to higher-end providers. We aim to be as inclusive as possible and to this end we keep our rates as low as we can. Children do not pay to stay at-all and it is unclear whether we would have to raise a levy even on people who have not paid to stay in our hut.
None of these are adequately addressed in the Regulatory Impact Assessment, which focusses primarily on commercial providers. We contend that the impact of this bill will be felt most heavily by providers which operate with little or no profit margins and for whom the task of administering the levy would fall on those with the least capacity.
A more detailed impact assessment is needed to measure the impact on volunteer run facilities particularly considering the administrative burden and its impact, and the risk to the viability of these important facilities.
(We would be grateful if you could keep your answer to around 500 words).
There is significant danger of negative unintended consequences from the bill on our mountaineering club hut and others like ours.
We may face closure or reduced viability due to administrative and financial burdens. We already struggling to attract volunteers despite the significant public good we contribute and minimal strain on infrastructure.
We will have to significantly increase our fees (by up to 50%) to cover the levy even if non-paying visitors are exempted which is not clear to me on reading the information provided. This will reduce affordability and impact the inclusivity of tourism and residential stays in Wales. It will also reduce the amount of money that our guests have available to spend in the local economy while they are staying. For our type of accommodation, the levy is a far more substantial percentage of the total overnight cost, even with the reduced rates, than for hotel or airbnb type accommodation. The cost of administering the levy means that it is possible that the price of accommodation would rise by more than the £0.75 or £1.25 fee.
Negatively impacting our type of accommodation will have broad negative impacts to Welsh outdoor tourism, which currently has an annual impact of 1.6 billion, supporting an estimated 31,000 jobs.
We run at zero profit margin, and would rely on untrained volunteers to administer the levy. The significant fines referenced in the bill could have a disastrous impact on voluntary organisations like ours, causing some to have to cease operations permanently.
(We would be grateful if you could keep your answer to around 500 words).
While the financial assessment highlights the potential for increased revenue, it underestimates the impact on small, volunteer-run, and low-cost providers. The costs of compliance, especially for non-profit organizations, and the inequity of a flat-rate levy are not sufficiently addressed. Additionally, there is limited discussion of how funds will be transparently managed and reinvested.
The powers to make subordinate legislation are set out in Part 1: Chapter 5 of the Explanatory Memorandum (https://senedd.wales/media/g5ipwvwh/pri-ld16812-em-e.pdf).
The Welsh Government has also set out its statement of policy intent for subordinate legislation (https://business.senedd.wales/documents/s155951/Statement%20of%20Policy%20Intent.pdf).
(We would be grateful if you could keep your answer to around 500 words).
The balance leans too heavily towards subordinate legislation, leaving significant aspects, such as levy exemptions and premium caps, to future determination. This creates uncertainty for providers and stakeholders. Clearer definitions and guidelines should be included in the Bill itself to ensure fair and transparent implementation.
(We would be grateful if you could keep your answer to around 500 words).
In my view the bill does not accurately reflect the diversity and unique needs of all of the varying types of visitor accommodation providers in Wales, nor does it appropriately consider the capacity of all of them to deliver revenue via the visitor levy. There seems to be a lack of comprehension of the operation of mountain huts and bothies.
(We would be grateful if you could keep your answer to around 500 words).
The indicative additional provisions may increase the administrative burden on providers, especially small or volunteer-managed accommodations like ours. Without specific exemptions or support mechanisms for non-commercial facilities, these amendments could exacerbate existing challenges rather than resolve them.
An additional concern is that local authorities may introduce registration/licensing fees – we ask that non-profit accommodations be given an exemption from these.
(We would be grateful if you could keep your answer to around 500 words).
Considering all factors, many types of accommodation are currently potentially captured within the scope of the bill which could result in negative impacts on the Welsh Government’s sustainable tourism goals, limiting access to the Welsh countryside, and having a disastrous impact on outdoor education. Commercial and non-commercial accommodations are treated as the same when their impacts could not differ more. This should be resolved in future drafts of the bill.
The impact of this bill on young people staying at our type of accommodation is also likely to be considerable. I ask that the decision to include children within the scope of the levy be reconsidered, and for those under the age of 18 to be excluded in all instances. We do not charge children for staying at our hut in order to encourage parents to introduce their children to Wales from a young age.
I am concerned about the ring-fencing of revenue – clear mechanisms are needed to ensure that revenue is reinvested transparently into services that benefit both visitors and local communities. I feel that councils be required to publish detailed breakdowns of how levy funds are spent including outcomes achieved. This would help achieve buy-in from accommodation providers.
I am also calling for changes to the bill to support non-commercial, volunteer-managed facilities, to avoid potentially disastrous unintended financial and administrative burdens. I am calling for extended administrative deadlines. If fees are to be applied to volunteer-run accommodations, then we would like administrative processes to be made as easy as possible for non-commercial accommodations, and for reporting windows to follow the convention set by existing charity commission rules.
I ask that the Welsh Government reconsider its plans for a flat-rate levy. A proportional levy based on accommodation cost would be more equitable and ensure fairness across all types of providers. Alternatively an exemption for providers charging less than a certain amount per night could be introduced.