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 Owner/operator | Evidence from Owner/operator
(We would be grateful if you could keep your answer to around 500 words).
The government’s own economic forecast show that there is little to be gained from the tax and it could result in a huge loss to the economy. The headline rate of £33 million was how much might be collected if every council adopted it which is by no means certain and for many it won’t be worth the harm it does to the hospitality industry in those counties. The governments own forecast is for between something like £1.7 million gain and a £7.3 million loss and that there will be a loss of jobs. That’s not a good basis to introduce a tax which by government’s own forecast is highly likely to have a negative impact in each of the policy objective areas.
It seems wiht this tax the government is set on destroying tourism not supporting it. The tourist tax harms the whole industry and is adding to the feeling that visitors are not wanted in Wales. Around 60% of tourists in Wales are from within Wales and are therefore paying to visit and travel within their own country so this is not rich people from another country paying to support Welsh tourism but ordinary Welsh residents having to pay more to support tourism in their own country. It is just moving Welsh resident's money around in a pointless way that benefits nobody, (except perhaps the WRA which is paid to administer it and the English government which will benefit from the VAT collected).
It should apply to day trippers rather than overnight stayers as they cause the most problems and are least likely to contribute to local economies. Visitors who stay for longer periods are the most sustainable and therefore should be encouraged and not taxed. Staying for a week means there are fewer car trips and those tourists tend to be more invested in looking after the place where they are staying. Day trippers means more cars and rubbish while those who stay in self catering or hotels etc have their rubbish taken care of by the business owner so this is a more sustainable option and should be encouraged. This tax likely leads to in increase in day trippers and acts against sustainable tourism.
Many Self Catering businesses are owned and operated by local residents and overnight stays directly contribute to the local economy where day trippers are much less likely to make a contribution in any way so government is encouraging the least sustainable option (day trips) by taxing overnight stays.
It is more likely to affect small operators which are some of the most sustainable out there e.g I run a plastic free accredited business, support myself by running my FHL in my own village, encourage visitors to stay local and buy local. But I don't have time or ability to administer tourist tax nor wish to pay it from my business reducing it's profitability and viability. I may end up having to to do as have to reach 182 nights to avoid severe financial penalties just for trying to run a business in my own village. That directly affects the profitability and sustainability of my local business and how much I can spend and invest locally.
A flat rate means it disproportionally affects lower cost holidays affecting in particular the poorer visitors and families with children. It’s a further deterrent to visitors taking holidays in off season which particularly affects furnished holiday let operators by making it even more difficult for them to attract holiday makers in off season when the levy could be 10% or more of the nightly rate.
It should never apply to children below 18 years ol
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).
It is unfair to expect small business owners to be responsible for collecting and submitting the levy. Many self catering businesses are owner operated and we already have to undertake sales and marketing, administration of bookings, undertake or organise cleaning and laundry, maintenance and repairs, accounting etc etc The imposition of yet another layer of administration of a visitor levy which is in effect a bed tax on accommodation providers is a huge burden.
The requirement of quarterly returns makes a bad situation much worse and it is unfair to expect us to do this on top of everything else we do to support sustainable tourism in our local areas. Most of us cannot afford to pay anyone to help us so we do all the work ourselves
We also should not be responsible for accuracy of returns since unlike hotels we rarely see the visitors as part of the attraction for visitors is being left alone. Bookings are often taken a year or more in advance and we should not be held responsible should visitors give us information that is incorrect and yet we are told we face severe penalties if we don’t make accurate returns which are simply not possible to obtain.
It should not apply to small operators under the VAT limit as we are not able to reclaim the VAT applied and we have extremely small margins as it is. The Manchester Visitor levy by contrast applies only to hotels with a rateable value over £75,000. That is a tax of £1 per room so when two people stay it is just 50p each. It doesn't apply to B & Bs and small self catering operations.
Also it can be charged by the hotel directly on check in while we have holiday makers booked years in advance and mostly never see them, so cannot possibly take on the responsibility. Nor is it fair to charge this on beds that are not actually occupied i.e where only two people stay in a 3 bed cottage then only two people should be charged. We will now have to alter all our contracts to get visitors to explicitly state how many will stay - this adversely impacts our the way we run our businesses which are set up to make profit and directly impacts our bottom line.
It will make administration for small operators who often do all their own sales/marketing/admin/accounts etc, a nightmare.
(We would be grateful if you could keep your answer to around 500 words).
The unintended consequences are likely to be a huge loss of jobs in the hospitality industries especially in counties which struggle to attract tourists already, especially in the off season. On winter lets the tax could add 10% or more to the total cost and the fact that it applies also to children mens that tourists are likely to look elsewhere. Governments own forecast shows this and that there is likely to be a transfer of money from private to public sector. It’s likely that it will encourage more day trippers which is the least sustainable form of tourism and so is the opposite of the intended effect.
It is likely to deter visitors making it much more difficult for self catering businesses to achieve the 182 nights occupancy out of the 252 required to be available (a 75% occupancy rate which is already 25% more than industry average) and in the face of the decrease in tourism shown by the Wales Tourism Barometer June 2024 wave and the forecasted decrease both in general and the additional 1.9% decrease the government have forecasted as a result of this tax, it will contribute further to the destruction of many Welsh residents livelihoods.
As the tax is not even ring fenced for tourism purposes it will undoubtedly be used by councils as another means to fill their general coffers just like the Council Tax premiums are already.
Some of the most sustainable businesses are self-catering businesses run by local people in Wales to support themselves in their own homes and these are most likely to be badly affected. As ever it is the locally owned, sustainable, self catering businesses that adhere to all health and safety rules and regulations and abide by all laws, like mine that will bear the brunt of the unintended consequences.
Surely the aim should not be to hasten the destruction of locally owned tourism businesses that support Welsh families to remain in their own homes and contribute hugely to the local economy.
Along with the 182 rules this is another damaging bill that is unlikely to have the positive effects the government intend and has potential to be hugely destructive to tourism in general, to local councils and economies and to local people who rely on their FHL businesses for their income. This includes local small holders and farmers and those who have bought or inherited property in their areas which they use to encourage tourism and support themselves and their local area.
(We would be grateful if you could keep your answer to around 500 words).
It doesn’t meet it’s objectives because the governments own assessment shows it be at best broadly neutral in terms of cost/benefit and quite likely to be entirely negative in terms of impact on tourism. The forecast is that it will reduce visitor numbers by 1.6% -likely to be reduced much more in low-cost holidays and out of season holidays. This is in direct opposition to the government's stated aims when introducing the 182 nights rule that it wanted to encourage out of season tourism
The headline rate of £33 million didn’t take account of effect of reduced visitor numbers or that the money is basically just a redistribution from private sector (reducing their ability to invest in tourism for the benefit of their local economies) and into the public sector where they do not have to invest directly in tourism.
The net effect of of between 1.9m gain and a probable £7.3 million loss do not suggest that this is an economically viable tax to introduce when the down side is so huge and the loss of jobs also assessed to be huge and not offset by any resultant public sector jobs increase.
It also doesn’t meet the governments own taxation principles:
It unfairly burdens accommodation providers when it is day visitors that cause the most problems with tourism and are least sustainable
It does not deliver Welsh Government policy objectives, in particular supporting jobs and growth because it is likely to have the opposite effects according to government’s own economic forecast - a huge likely loss of jobs and money from tourist sector. A transfer of money and jobs to public sector away from tourism sector is not helping grow sustainable tourism
It should not be subject to premiums as these are unclear and it’s not simple for owners to have to collect nor is it progressive since it is more burdensome on low cost holidays and families with children and impacts mostly those already resident in Wales as 60% of tourism is domestic.
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 councils should not be allowed to impose premiums to the levy - CT premium introduction has shown the councils end up using premiums to prop up their general coffers and not for purposes intended by the original legislation. Also some councils have tended to disregard inputs from businesses to such consultations if what happened with CT premiums is repeated with these.
Setting the level for quarterly returns at £1000 is way too low as many sole trader self catering FHL businesses will end up having the onerous task of having to make quarterly returns if they have a small cottage making 182 nights. This should be much higher and apply only to businesses with large turnovers not to people running their businesses alone as many FHL owners do. We simply do not have time for this along with every thing else we do in running and maintaining our businesses.
It should be possible for businesses to opt for quarterly returns if they wish to and should not be legislated on. For many small businesses it is impossible to predict and there definetly should not be any penalty for the business. Presumably it will also increase costs for WRA if they have to process quarterly returns rather than annual so all returns should be annual.
(We would be grateful if you could keep your answer to around 500 words).
A piece of legislation that by the government’s own economic assessment is highly likely to cause a loss of money and jobs is poor legislation and should not be passed through the Senedd.
It should not be introduced at this time when visitor numbers are declining and forecast to decline further and tourism businesses are already under huge pressure. Numbers have not yet recovered to pre pandemic levels (excluding the bounce back year of 2021) The impact of the cost of living crisis also makes this a very bad time to introduce a tourism tax when visitors are more price sensitive than ever and money is tight for everyone.
(We would be grateful if you could keep your answer to around 500 words).
A registration scheme for accommodation providers should have been the first step - even before the imposition of the 182 nights rules and should be linked to ensuring safe and legal accommodation and a level playing field for providers.
This legislation does not do that and appears to be looking at registration purely to facilitate the extraction of more money from the sector with no regard to the likely destructive consequences.
Self catering business owners should not be held responsible if tourists give inaccurate information since unlike hotels we are not in a position to verify information received in good faith.
(We would be grateful if you could keep your answer to around 500 words).
The Welsh Government should not even be thinking of introduced a Visitor Levy at this time when visitor numbers are declining and forecast to decline further and tourism businesses are already under huge pressure. Numbers have not yet recovered to pre pandemic levels (excluding the bounce back year of 2021). The impact of the cost of living crisis also makes this a very bad time to introduce a tourism tax when visitors are more price sensitive than ever and money is tight for everyone. Recent poor weather has exacerbated this in particular in areas like rural and coastal Wales where there are no indoor all weather attractions and most tourist attractions are unable to run in winter when weather is poor as they are outdoors
The imposition of the burden of collecting and remitting of this tax is huge on many small self catering businesses, many of which are operated by local residents to support themselves and their local economies.
Small self catering businesses where families stay for a week or more and contribute to local economy while reducing car trips compared to day trips and where their rubbish removal is paid for by the business owner are some of the most sustainable businesses in Wales since they sustain local residents and communities with minimal impact.
The tourist tax will have the greatest negative impact on these businesses when they are the exact ones that
a) need the most help to survive according to the Wales Tourism Barometer June 2024 wave
b) are some of the most sustainable in terms of low impact, low cost to communities and often are the hardest working to be sustainable in terms of environmental impact too
c) often are run by people who are heavily invested in their local community like myself who spearheaded the successful local Plastic Free Community campaign and served on village hall committee and fight for clean bathing water.
The Welsh government need to look again at how they can support these businesses and not add yet another layer of damaging legislation which is already affecting not just individual Welsh residents livelihoods but whole communities who are reliant on tourists and the income they bring to an area.