Support for a London-wide tourist tax appears to be growing with the Lib Dems and Green Party on the London Assembly backing calls for the Mayor to be given powers to implement one.
The Mayor of London, Sir Sadiq Khan, continues to support a “modest overnight accommodation levy” for any visitors to the capital, his office said on Monday (August 11), as a new report urged the government to give local leaders the power to impose the tax.
In England, local councils currently do not have the power to introduce a tourist tax, but the Autonomy think-tank has told ministers that giving local leaders the necessary powers would reduce the strain on public services.
Several London councils, including Brent, Greenwich and Southwark, have called for borough-wide levies in recent months, though Southwark councillors passed an amended motion seeking only to do so as part of a city-wide tax.
But the government has continued to resist calls for local tourist taxes, and today confirmed there were no plans to introduce a tourism tax in England.
In June, alongside other Mayors of major cities, Mr Khan said: “London attracts millions of visitors every year who come here to experience our world class museums and galleries, visit our historic attractions and enjoy an amazing array of sporting events.
“A modest overnight accommodation levy, similar to other international cities, would boost our economy, deliver growth and help cement London’s reputation as a global tourism and business destination.”
Manchester and Liverpool city councils used a legal workaround in 2023 by both introducing a tourism-based Business Improvement District (BID), meaning they could collect taxes from hotels and serviced apartments.
Last month a YouGov survey commissioned by the Greater London Authority (GLA) Oversight Committee found that 41 per cent of Londoners backed the Mayor’s Office having the powers to levy a tourism tax.
Hina Bokhari, who leads the Liberal Democrat group on the London Assembly, told the Local Democracy Reporting Service (LDRS): “It’s past time London just got on with it and introduced a tourism tax – a small sum for tourists, which would add up to a big investment in our city. Manchester’s done it, Liverpool’s done it – it’s time we joined them.”
A spokesperson for the Green Party on the London Assembly told the LDRS: “We will ask hotels and bed and breakfasts to opt in to a modest nightly levy of 50p, with the potential of raising £50 million annually.
“This funding would be dedicated to supporting initiatives throughout our manifesto, aiming to enrich and equalise access to arts, sports, and culture, beginning with areas with the least access to local activities.”
Reform UK oppose a tourism tax
But Reform UK Assembly Member Alex Wilson told the LDRS: “Sadiq Khan has failed London. Due to his incompetence, tourists from Australia, France, Canada – even Mexico – are being warned to ‘exercise caution’ when visiting the UK because ‘petty crime is common, including pickpocketing’.
“Slapping a tourist tax on top of this will only drive visitors away and cripple London’s economy further.”
In 2017, the London Finance Commission estimated that a tourist levy could yield anywhere from £77 million to £240 million annually in London.
The Conservative group on the London Assembly declined to comment on whether they supported or opposed a tourist tax in the capital.
A Ministry of Housing, Communities and Local Government spokesperson said: “There are currently no plans to introduce a tourism tax in England. Places including London can already choose to introduce a levy on overnight stays through the Accommodation Business Improvement District model.”
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