Why the ‘Tourist Tax’ in Dorset is on Hold Amidst Hotel Opposition

The proposed introduction of the first coastal tourist tax in the UK has faced significant opposition, leading to its postponement. This latest news highlights the contention surrounding the levy set to be introduced in parts of Dorset, specifically affecting Bournemouth, Christchurch, and Poole.

The ballot conducted in May saw approval from hoteliers for the tourist tax, which would require guests in larger hotels to pay an additional £2 per room per night. Despite this, over 40 hotels have now appealed to the government, questioning the validity of the ballot process. The Accommodation Business Improvement District (Abid) initially planned to introduce the tax on Monday but has decided to delay its implementation until the autumn, pending the outcome of the appeal. This decision followed a consultation that led to the tax’s approval in May.

Emma Russell, representing Leisureplex Hotels, voiced concerns over the financial implications for her establishment, The Norfolk Royale, estimating an annual cost of up to £60,000. She supports the appeal to the Department for Levelling Up, arguing that the scheme was introduced too hastily. Russell highlighted the potential negative impact on tourism in Bournemouth, stating, “Customers were already saying ‘we’ll go elsewhere’ – it really won’t do any favours for Bournemouth’s visitor numbers.” She advocates for a more commercially viable solution, emphasizing that the levy disproportionately affects the largest 75 hotels in the area.

BCP Council, encompassing Bournemouth, Christchurch, and Poole, has recently announced cost-cutting measures, including the termination of subsidies for the annual air festival after 2024. English councils, despite lacking direct authority to impose tourist taxes, have found ways to implement similar charges through legal workarounds. This is detailed in a House of Commons briefing paper, citing examples such as Manchester and Liverpool.

When the tourist tax was approved in May, Abid claimed it would enhance and expand tourism by generating £12 million over five years, aimed at attracting more visitors. The concept of a visitor charge is common in many international destinations. Rosie Radwell, the chair of Abid, expressed confidence in the ballot’s integrity despite the challenges posed by the diverse range of hotels in the area. “This process has been challenging due to the diverse range of hotels in the area and finding a ‘one size fits all’ solution has been complex. We are actively listening to accommodation providers and considering their feedback all the time,” Radwell stated.

BCP Council’s chief executive, Graham Farrant, also defended the ballot process, asserting, “We are confident the ballot process has been carried out fairly and in line with legal regulations.”

The proposed tourist tax has sparked a heated debate within the tourism industry. Proponents argue that the additional revenue would be instrumental in promoting and sustaining tourism in the region. By generating substantial funds, the tax could support local attractions, infrastructure, and marketing efforts to draw more visitors. However, opponents, particularly hoteliers, fear the tax could deter tourists, thereby reducing occupancy rates and overall revenue. This concern is especially pronounced for larger hotels, which would bear the brunt of the levy. The hospitality sector, already reeling from the impacts of the COVID-19 pandemic, is wary of any additional financial burdens that could stifle recovery.

As the debate continues, stakeholders are calling for a balanced approach that addresses the concerns of hoteliers while still achieving the objective of boosting tourism revenue. Emma Russell’s call for a commercially practical solution underscores the need for a more inclusive discussion involving all affected parties.

The postponement of the tourist tax provides a window of opportunity for such discussions. Hoteliers, local council representatives, and tourism authorities must work together to devise a plan that is fair and beneficial for all. This collaborative approach could help mitigate the negative perceptions and ensure that any future implementation of the tax is met with broader support.

The situation in Dorset could serve as a case study for other regions considering similar measures. The appeal process and subsequent decisions will likely be scrutinized by policymakers and industry stakeholders nationwide. If the tax is eventually implemented with adjustments that address the current concerns, it could pave the way for more widespread adoption of tourist taxes across the UK. Conversely, if the appeal results in significant changes or the abandonment of the tax, it could deter other councils from pursuing similar initiatives. The outcome will be a critical indicator of the feasibility and acceptance of tourist taxes in the UK’s hospitality and tourism sectors.

The delay in implementing Dorset’s tourist tax underscores the complexities and challenges of introducing new levies in the tourism industry. As hoteliers and local authorities navigate this contentious issue, the focus remains on finding a solution that supports both the economic goals of the region and the operational realities of its accommodation providers. The resolution of this matter will have far-reaching implications for the future of tourism-related taxes in the UK, making it a pivotal moment for all stakeholders involved.

As reported by the BBC in their recent article