Elected members made the decision at a meeting of Shetland Islands Council’s policy and resources committee on Monday after consultants carried out a feasibility study on the so-called tourist tax
Proposals for a tourist tax on one of the most remote bits of the UK have been binned by local politicians.
Shetland councillors have officially rejected the idea of implementing a visitor levy, choosing instead to explore alternative ways of generating revenue with the Scottish Government. The decision was made during a meeting of Shetland Islands Council’s policy and resources committee on Monday, following a feasibility study into the proposed tourist tax.
Council leader Emma Macdonald voiced her opposition to the levy, stating it “just isn’t the answer, and doesn’t make sense in our context”. A report presented to the councillors argued that the “risks outweigh the benefits”, highlighting concerns about the administrative burden on accommodation providers and potential negative effects on visitor numbers.
READ MORE: British couple banned from Venice and fined £400 for jumping in canalREAD MORE: Quirky town is ‘jigsaw’ where your front door determines what country you’re in
Under recent Scottish legislation, councils now have the authority to impose a levy on overnight stays, providing them with an additional source of income. Similar levies are already in operation around the world, including in several European cities.
The goal is to generate funds to develop, support or maintain facilities and services primarily used by tourists or business travellers. However, a report suggested that despite Shetland’s bustling tourism industry, if 30 per cent of visitors were exempt, a five per cent levy would likely generate less than £1 million over a decade.
Earlier this year the councils in Shetland, Orkney and the Western Isles appointed a consultant to investigate the feasibility of a visitor levy scheme for each of the three areas.
Point of entry and cruise levies were considered to be “potentially be more favourable” as ways of generating revenue. The Scottish Government recently consulted on the idea of a separate levy on the cruise ship sector, but no decisions have been made yet. Macdonald said there was potentially merit in a point of entry or cruise ship levy, but said the visitor levy does not make sense for Shetland.
Deputy Gary Robinson spoke out against the visitor levy. He said he felt the process had reached a “natural conclusion” and added that to him the levy seemed like something dreamt up to tackle visitor economy problems in Edinburgh.
The steep costs for tourists travelling to Shetland in the first place was also highlighted.
READ MORE: Should tourists pay an ‘eco-tax’? Take our poll and have your say
Robinson added that if First Minister John Swinney was enthusiastic about greater autonomy for Shetland then a good starting point would be allowing the local authority to make its own choices on income generation matters like the levy.
He also said the reality was that the recent hike in NorthLink ferry fares would itself likely raise more money than the levy would. Meanwhile, North Isles representative Robert Thomson stated that he has received feedback from local businesses who are not supportive of the scheme.