The proposed introduction of a visitor levy—often termed a tourism tax—on overnight stays has exposed significant administrative challenges particularly regarding how best to collect the charge from short-term holiday lets, including Airbnbs.
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. A consultation process is currently underway, allowing businesses, communities, and interested parties to submit input on how the fee should operate before the closing date of 18th February.
Despite enthusiasm from some, the proposal has drawn caution, with some hoteliers reportedly "deeply concerned" by the implications for the tourism sector.
While the concept of a transparently raised levy holds merit for generating funds for local investment, ensuring the charge is applied consistently across all accommodation types is viewed as the central logistical hurdle.
Local representatives agree that for the levy to succeed, it must be universally applied. Whitby Councillor Neil Swannick noted that collecting the levy from traditional hotels is likely to be straightforward, reflecting established practice elsewhere, but applying it to short-term lets presents difficulty. For fair play to be observed by hotel operators, Councillor Swannick stressed that a clear system for taxing holiday lets must be established:
"Collecting the tax will be easy for hotels that's done throughout Europe to my knowledge but not so easy for short-term lets.
I think that if the hotels are to to be able to see fair play done then I think there has to be a mechanism for taxing short-term lets as well and I think that would be popular in Whitby".
Leveraging Agencies and Data Collection
For Scarborough Councillor David Chance, the existing method of booking holiday accommodation provides the obvious solution for administering the new tax. Councillor Chance suggested that collection should be handled centrally by agencies, rather than requiring individual owners to collect the funds, which he argued would be an inefficient approach:
"The method of booking holiday accommodation is through agencies. And I think it would be wrong if they went down the line of registering every let individually and trying to collect the money because the individual owners don't collect the money themselves. It's got to be done through the agencies.".
This need for a functioning mechanism links directly to wider proposals for managing the sector, according to Scarborough and Whitby MP Alison Hume. Ms Hume stressed that the levy "has to be applied to everybody"—including hotels, Airbnbs, and "anybody else providing accommodation"—and suggested that implementing the tax would actually push forward necessary regulatory systems, such as registration and licensing. Ms Hume views the levy as requiring the necessary data collection to ensure equality in its application:
"It has to be applied to everybody, not just hotels, but Airbnbs and anybody else providing accommodation.
And in a way, I think it will actually help move things along for the registration and the licensing because how are they going to do it if they don't have the information? And this is exactly the data collecting exercise that I think that we need in order to be able to levy everybody equally.
So I think it will happen. I think that the registration must happen sooner than we thought in order for the levy to go ahead. So, I think perhaps we're moving in the right direction.".
Alison Hume has stressed the importance of ensuring that any taxes raised locally in areas like Scarborough and Whitby—which she describes as "the jewel in the crown"—are ring-fenced to be spent on local needs, such as transport infrastructure.
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