East Riding Councillors Oppose Proposed Tourism Tax For East Yorkshire

East Riding Councillors have voiced strong opposition to a proposed visitor levy, warning it could damage the local hospitality sector and deter tourists.

East Riding Councillors have voiced their strong opposition to the proposed introduction of a visitor levy, or tourism tax, in East Yorkshire.

Government proposals could see a new levy placed on overnight stays.The move to grant regional mayors the power to introduce a levy on overnight stays has been welcomed by some as a potential "game changer" for the region but others have raised significant concerns regarding the economic pressure on local businesses and the necessity of keeping funds within the communities that generate them.

A formal motion submitted by Councillor Mike Heslop-Mullens, urged the local authority to reject the concept of an accommodation levy on overnight stays.

The motion, which has been backed by councillors, outlines that such a tax would act as a significant disincentive to visitors, ultimately making the region less competitive when compared to alternative destinations that do not impose these charges.

Furthermore, the motion requests that the council writes directly to the Combined Authority Mayor to formally oppose the potential tax hike on the hospitality sector.

According to the motion, the local hospitality industry is already reeling from the recent imposition of a business rates review and higher national insurance contributions, and the Mayor is being asked to dismiss the option of adopting a visitor levy for Hull and East Riding.

Councillors Mike Heslop-Mullins, Denis Healy, and Eliza Whitaker have all spoken out against the potential implementation of the levy, highlighting the fragility of the local tourism economy.

Councillor Denis Healy said:

"Imposing a tax on visitors who stay overnight would make us less competitive, it's as simple as that. Because tourism here isn't like tourism in other cities, places like Cambridge, York, Stratford-upon-Avon. These cities have established visitor demand. Here in the East Riding our visitor economy is more fragile, it's more seasonal, and it is more heavily dependent upon independent businesses. So a levy here would not skim cream off a booming sector, which is what it would do in other places, it would depress the very activity that we're trying to stimulate."

"So the East Riding is different, and that's precisely why we can't afford to introduce a deterrent.

Councillor Eliza Whitaker said:

"A tourism tax may appear modest in isolation, but from a visitor's perspective, it becomes part of the wider calculation, particularly given the cost of living crisis etc that we're going through. This creates a simple risk, that we make ourselves just slightly less attractive, and it comes at a time when the hospitality sector is already under significant pressure. Businesses are dealing with rising costs, workforce challenges, ongoing uncertainty and what they need now is stability and support, not barriers attracting customers."

"Those customers bring money into our area, which is good for all of us. It's about recognising that local businesses are key partners in our economy and ensuring that we do not unintentionally undermine them.

Councillor Healy says the region needs to focus on expanding it's tourism sector and doesn't think introducing a visitor levy would help with that:

"We want to welcome people here, not tax them, we want to encourage longer stays, not shorter ones, we want a thriving visitor economy, not a shrinking one, and this would do more harm than good. Let us support our hospitality sector, back our town of culture ambitions, and send a clear message that the East Riding is open, competitive, and welcoming to visitors without additional charges."

Councillor Mike Heslop-Mullins also thinks the introduction of a "Tourist Tax" would be detrimental to the regions hospitality businesses.

"We need to make it perfectly clear that this tax is not right for this region, and it acts as an extra cost for visitors, and will damage hospitality businesses. An overnight levy would penalize the very visitors we want to encourage, it would operate as a bed tax penalizing staying guests while leaving day visitors untaxed. Overnight guests contribute more economically, spending on retail, pubs and restaurants and attractions. This tax would undermine the behaviour we want to encourage."

The councillor is worried that the levy would end up being paid by small local businesses rather than visitors.

"Market pricing is already highly competitive. If accommodation providers could simply add the levy to their prices without consequences, they would already be charging it. Additional tax would have to be absorbed by business through reduced margins. A small increase on daily rates can create a disproportionate impact on occupancy levels."