UK hospitality businesses fear that a tourist tax would reduce visitor numbers, with trade body UKHospitality estimating a 5% levy on overnight stays in England could result in 12 million fewer visits and 33,000 job losses. Businesses in areas like the Lake District and Yorkshire Dales are concerned visitors might choose levy-free parts of the country instead.
However, evidence from other locations suggests a different outcome. Manchester, which introduced a £1-per-room-per-night visitor levy in April 2023, saw no significant impact on hotel occupancy, according to a 2025 study. This levy has raised £10.5 million in its first three years for cultural projects.
Similarly, Liverpool's hospitality firms introduced a £2-a-night charge in June, raising over £2 million for sports, culture, and conferencing projects. Councils in Scotland can already implement local overnight levies, with Wales gaining this power next April. Edinburgh introduced a 5% tourist tax on 24 July, though Edinburgh Tourism Action Group states it is "too early to draw any meaningful conclusions" on its impact.
Across Europe, tourist taxes have been introduced in 125 destinations and 26 countries by 2019. Research by Bangor University in 2024 found no evidence that these modest nightly charges deter visitors, with the funds often supporting public projects such as social housing and scientific research.