MP Says Tourism Levy Money Raised In Scarborough And Whitby 'Should Stay On Coast'

Scarborough and Whitby MP Alison Hume has argued that funds raised from a proposed overnight visitor levy should be reinvested directly back into the coastal communities that generate them.

Scarborough and Whitby's MP has warned about the impacts on ‘very price-sensitive’ domestic tourism from the possible introduction of a new overnight visitor levy by regional mayors.

The elected mayor of York and North Yorkshire will be given new powers with a levy on overnight stays as part of a devolution drive to shift power out of Westminster.

Labour’s regional mayors in England, including David Skaith, have pledged to cap a new fee on visitors’ overnight stays at 5 per cent, after hospitality bosses warned it could put jobs at risk.

A report by York St John University, commissioned by the mayor, found that a £1-a-night visitor levy on overnight stays in York and North Yorkshire could raise up to £26 million a year.

Alison Hume, MP for Scarborough and Whitby, said:

“While I’m not opposed to a visitor levy in principle, Scarborough and Whitby are very different places to a city like York, which attracts large numbers of overseas visitors who are already familiar with paying tourist taxes across Europe and beyond.”

Speaking to the Local Democracy Reporting Service (LDRS), she said that domestic coastal tourism is “very price sensitive”.

“Here, tourism is built around family holidays and people saving up to treat their loved ones to a well-earned break on the coast. That’s why we need to think carefully about how a levy would work in our area. Domestic tourism is very price sensitive.

“My position is simple. Money raised in Scarborough, Whitby and the villages should stay in Scarborough, Whitby and the villages which bring in so much of North Yorkshire’s tourism revenue.”

Mr Skaith said:

“It’s good to have more clarity on what an Overnight Visitor Levy would look like and how it might be applied. No decision will be made without a full public consultation and more engagement with the hospitality and tourism sector.

“I know that people want to see improvements to our town and city centres, investment in our public services, and us showing off just how great our county is. That’s what money raised from a visitor levy will help us deliver.”

Andrew Carter, chief executive of Centre for Cities, said:

“The Overnight Visitor Levy is a great step forward for fiscal devolution. This marks the first time that mayors in England have gained more autonomy over funding.

“The Overnight Visitor Levy means places will get rewarded for doing what they need to attract more visitors and grow their local economies.

“It’s good that the decision is left up to mayors because they know their areas best. Rightly, some will choose to introduce it, and some will decide it doesn’t suit their place.

“This shows the importance of mayors to the economic agenda. It will now be up to them to ensure their visitor levy is set at the right rate and that they do what they need to fulfil the potential for growth in their local hospitality industry, alongside their new powers.”

Critics have argued that introducing the overnight levy could deter people from visiting York and North Yorkshire.

Gavin Lane, President of the Country Land and Business Association (CLA), said:

“A tourism levy sends entirely the wrong signal at a time when many rural businesses are already under significant financial pressure.

“Business taxes seem as incoherent as they have ever been. Increasing taxes via a visitor levy while at the same time reducing VAT on visitor attractions and business rates for pubs and clubs seems very poorly thought through and confusing.”

The CLA describes itself as “the only organisation dedicated to supporting landowners and rural businesses”.

Mr Lane said:

“The profit warnings from Greggs and Wetherspoons demonstrate that UK retail and hospitality is grappling with significant cost pressures, including 20 per cent VAT, business rates and rising labour costs. This is compounded in rural areas with poor transport links, weak digital connectivity and restrictive planning rules.

“Rather than introducing new costs for visitors and businesses, policymakers should focus on creating the conditions for this vital sector to thrive.”