WTTC warns: UK plans for local overnight stay levies could weaken tourism growth, jobs and competitiveness
In the United Kingdom, the question is reopening of whether and how to introduce local tourist overnight stay levies in England. At the end of 2025, the government launched a consultation that would grant selected local leaders—primarily metro mayors of city regions—the power to introduce an “overnight visitor levy”, a charge that would be applied to short-term overnight stays in commercial accommodation. Supporters argue this would secure a stable source of investment in transport, public space and the maintenance of destinations that attract large numbers of visitors, while opponents warn it would raise the cost of staying and risk losing part of demand. The debate has now been strongly joined by the World Travel & Tourism Council (WTTC), which says new charges could reduce growth, limit job creation and further weaken the global competitiveness of UK destinations.
WTTC’s warning comes as the UK “visitor economy” seeks to recover and consolidate after years of disruption brought by the pandemic, inflation, rising operating costs and changes to travel regimes. The organization, which brings together major private-sector players in tourism and related industries, says the UK is already among the more expensive European destinations and that new accommodation levies can influence the decisions of travellers comparing the total cost of a trip. In practice, it warns, even a “modest” charge can tip the decision for short city breaks, especially when a traveller is choosing between several European cities. The key point, it says, is that an additional burden is being introduced at a time when the sector is already battling high costs and complex rules.
What the government is proposing and who the new power would cover
On 26 November 2025, the government opened a consultation titled “Overnight visitor levy in England”, aiming to gather views on the design of a new power for Mayoral Strategic Authorities in England. Under the official framework, such powers would be held by combined city regions with directly elected mayors, including the Mayor of London, and the documents also consider whether the power should be extended to other forms of local leadership. The consultation addresses questions of scope: which types of paid accommodation fall within the system, whether short-term rentals should be included, and how to define exemptions. The government stresses it is not proposing a single national tax, but a framework in which local leaders can—if they consider it appropriate for their area—introduce a charge and set its rules.
The deadline for participating in the consultation is set for 18 February 2026 at 23:59. After that, the government should publish a summary of responses received and explain next steps, including an assessment of whether legislative changes are needed. The Parliamentary research service warns that, if it proceeds, changes through primary legislation would be required, meaning the final model would go through political debate, possible amendments and additional alignment with local and business stakeholders. In the background is a broader policy of devolution, because this power is seen as part of a package giving local leaders more fiscal tools. That is precisely why the debate goes beyond tourism and touches on local funding, the autonomy of city regions, and the fair distribution of costs generated by large visitor numbers.
WTTC: additional cost and fragmented rules could hit demand
In a statement dated 11 February 2026, WTTC stresses that new local overnight stay charges in England would come at a sensitive moment for the sector. The organization warns that UK tourism competes in a market where guests increasingly compare the “total cost of travel”, not just accommodation prices, and that even a small add-on can affect decisions for short city breaks. An additional risk cited is a scenario in which each region introduces different amounts, exemptions and collection rules, creating a patchwork of uneven rules that complicates trip planning and business operations. WTTC highlights the problem of “fragmentation”: different models in different cities can create the impression that travel in the UK is administratively and financially unpredictable. In such an environment, it argues, some travellers may choose alternative destinations that offer a simpler cost structure.
The organization also warns of a knock-on effect in the local economy. In tourism, accommodation prices and the number of overnight stays are closely linked to spending in restaurants, shops, museums and transport, so even a small change in length of stay can affect revenues across many sectors. According to WTTC, small and medium-sized enterprises bear the greatest burden in practice: family-run hotels, private landlords, local hospitality businesses and small attractions. They have less room to absorb new costs or to invest in new collection and reporting systems. WTTC emphasizes that, beyond the levy itself, the administrative burden must be considered, because additional obligations often disproportionately affect smaller entities. It also warns that part of the cost can spill over into the investment climate, as investors in hotels and hospitality assess long-term returns through regulatory stability and predictability.
UK price competitiveness and international comparisons
WTTC also ties the competitiveness argument to international rankings. In its public analyses, WTTC stresses that the United Kingdom has a problem with the perception of being an “expensive destination”, citing the World Economic Forum’s (WEF) Travel & Tourism Development Index 2024 as a reference. The WEF publication analyzes a broad set of policies and conditions affecting tourism development, including dimensions linked to travel costs and price affordability. From these indicators, WTTC draws the conclusion that additional accommodation levies could worsen the UK’s position precisely in the segment where price sensitivity already exists. Although supporters of the levy note that similar charges are common in major European and global cities, WTTC stresses that each destination competes in a specific price and regulatory environment and that the impact cannot be automatically copied across contexts.
In the UK public sphere, this debate fits into a broader context of travel costs and fiscal policy toward tourism. WTTC has previously warned that a combination of multiple measures can affect demand—from entry and administrative costs to tax burdens and the removal of certain incentives for international shoppers. In a 2025 statement, for example, WTTC emphasized that international visitor spending had not yet fully returned to pre-pandemic levels and that recovery in certain segments was slower than in competing destinations. The organization often insists that tourism is not just “consumption” but also an export of services, with a strong effect on employment and local supply chains. That is why warnings about new costs are not only about the hotel bill, but also about broader economic impact. In this framework, the levy debate becomes part of a debate about how the UK wants to position tourism within its growth strategy.
What supporters of the levy emphasize: local investment and a fairer distribution of costs
Supporters of the power argue that tourism, alongside its benefits, also creates costs that local communities often struggle to cover from existing budgets. This includes pressure on public transport, cleaning, public-space maintenance, security, crowd management and infrastructure that must operate at peak load during the season or major events. In its statement accompanying the consultation, the government stresses that levy revenue could help fund transport solutions, infrastructure and programs that directly support the visitor economy. The argument is that part of the benefits of tourism is returned to the destination in a way that improves the visitor experience and residents’ quality of life. Such an approach, supporters argue, reduces dependence on central transfers and allows local leaders to respond faster to a destination’s needs. The debate often also highlights the need for transparency, so the public can see where the money is spent and which projects are funded.
Some mayors have publicly welcomed the idea as a tool to strengthen local economies. In its communications, Liverpool City Region says the region receives large numbers of visitors and that a “modest” accommodation charge could generate significant funds that would be ring-fenced for cultural events, infrastructure and boosting global visibility. Actors from the cultural sector have also joined the debate, arguing that part of the revenue should be earmarked for cultural infrastructure, because culture and heritage largely drive tourism demand. Their message is that tourism spending does not sustain itself, but requires continuous investment in content, events and urban space. In that logic, the levy is presented as a tool to finance “public goods” that tourism uses, but which local authorities struggle to fund without additional revenue. A key condition for supporters is that the revenue is clearly tied to tourism-related projects, rather than used as general income without a clear purpose.
England already has “workaround” models: Manchester and Liverpool
Even without a new law, some English destinations have already found ways to raise additional funds from overnight stays through local arrangements. In Manchester, according to information cited by Liverpool BID Company, a supplement of £1 per night (plus VAT) is charged under a model linked to a Business Improvement District. Liverpool introduced a “visitor charge” of £2 per night through an Accommodation BID, explaining that the funds are reinvested in promotion and attracting events, and in activities that strengthen destination marketing. Such models are often described as “pragmatic solutions” in a situation where there is no single legal framework for a tourist levy in England. But that is precisely why they are politically sensitive, because they rely on specific local mechanisms and agreements with the business sector. In public debate, this is sometimes seen as proof that charges can be implemented without a significant drop in demand, and sometimes as a warning that the system is becoming uneven and hard to understand.
That very diversity is now one of the arguments in the consultation: should a new framework reduce the need for workaround solutions and introduce clearer rules. At the same time, WTTC and part of the industry warn that existing examples already show how travellers’ picture of total trip cost can be complicated. If the system expands to the level of mayoral regions, standardization of minimum elements will be crucial—from the definition of accommodation within scope, through how the charge is itemized on the bill, to rules for reporting on the spending of collected funds. The consultation seeks views precisely on these elements, including whether there should be a national framework of exemptions and limits. The question is also how platforms and intermediaries will be treated, because part of accommodation is booked through digital channels and short-term rentals. In such a market, the gap between “theory” and “implementation” often determines whether a system will be effective or will create additional costs without clear benefit.
- The focus is on scope questions: which types of accommodation to include and whether to exempt certain categories of stays.
- The structure of the charge is debated: a fixed amount per night or a percentage model, and whether there should be a cap or guidelines.
- One of the key issues is collection in a digital environment, including platforms and intermediaries.
- An important element is transparency: how to ensure the revenue is used for projects that directly strengthen the destination.
Scotland and Wales: parallel processes and the Edinburgh example
The England debate is not happening in isolation, as tourist levies are also being introduced in other parts of the UK. According to earlier decisions and media reporting, Edinburgh has announced an accommodation tourist levy that should be fully implemented from July 2026, with rules limiting the number of nights to which the charge applies. This example is often cited as a precedent because it covers a wide range of accommodation types, from hotels to short-term rentals, and is introduced through the Scottish legislative framework. In parallel, Wales is debating the powers and a model that would allow local authorities to introduce their own tourist charge. For England, this adds political pressure: supporters argue that English regions are falling behind without a similar tool, while opponents warn of the risk of cumulative increases in the cost of travelling within the UK. In practice, this means the debate is less and less about whether “a tourist levy exists elsewhere” and more about the design that is workable and fair in the British context.
The Scottish and Welsh processes also show how sensitive design is. Debates revolve around whether a fixed amount per night or a percentage of the price is fairer, whether to exempt children, longer stays or business travel, and how to treat seasonality. Each of these decisions directly affects revenue and perceptions of fairness, as well as administrative implementation. In England, there is now an attempt to open these questions in advance to avoid later improvisation and political “firefighting” solutions. But even with the best design, the fundamental dilemma remains: how much additional cost the market can bear without losing overnight stays and spending. WTTC in that sense calls for caution and impact assessment, while local leaders seek an instrument to invest in infrastructure that, they argue, sustains tourism in the long term.
What happens after the consultation and where the key unknowns lie
After the consultation closes on 18 February 2026, the government should publish how it assessed the arguments from industry, local authorities and citizens. If it decides to proceed, the proposed law will have to resolve several practical issues that determine the levy’s real impact. First is the level and structure: whether there will be a national cap or guidelines that prevent a sharp rise in the charge in certain destinations. Second is implementation in the platform market, because part of accommodation is no longer tied to classic hotel channels, and collection can take place through multiple intermediary layers. Third is transparency and purpose: whether the revenue will be firmly tied to tourism-related projects or will flow into general local budgets. Fourth is simplicity: whether the system will be clear enough for travellers and easy enough for businesses to implement, especially smaller ones. These operational issues often determine whether the measure is perceived in practice as useful investment or as just another price increase.
WTTC’s warning published on 11 February 2026 will likely intensify demands that a more detailed impact assessment on growth, jobs and investment be produced before a decision is made. The government, on the other hand, will have to convince the public that this is an instrument that strengthens local infrastructure and helps tourism in the long term, not an additional burden introduced to plug budget holes. In the coming weeks, the debate will increasingly come down to figures and mechanisms: what level of charge can be modest without harming demand, how to avoid fragmentation of rules between regions, and how to prove that the revenue brings visible benefits to destinations. For tourism, the outcome will not only be about one charge, but also a signal of what kind of policy the UK pursues toward visitors and investors. For local authorities, it is a test of whether they will receive a financial tool that can redirect part of tourism spending into long-term public projects. For the sector, it is a question of balancing investment in destinations and the burden that can change traveller behavior.
Sources:- GOV.UK – statement on the plan to allow mayors to introduce an overnight stay levy and invest in local growth ( link )- GOV.UK – open consultation “Overnight visitor levy in England” with a closing deadline of 18 February 2026 ( link )- GOV.UK (PDF) – consultation document on the design, scope and possible exemptions of the levy ( link )- House of Commons Library – analysis of the proposed visitor levy powers and the legislative framework ( link )- WTTC – statement “WTTC warns that new UK tourism levies would dent growth, restrict jobs and reduce competitiveness” (distributed 10/11 February 2026) ( link )- World Economic Forum – Travel & Tourism Development Index 2024 (methodology and indicators linked to price competitiveness) ( link )- WTTC – analysis of UK tourism competitiveness challenges and tax burdens ( link )- WTTC – statement on the decline in international spending and policies affecting UK attractiveness ( link )- Liverpool BID Company – information on the “visitor charge” model and amounts in Liverpool and Manchester ( link )- Liverpool City Region – the mayor’s position and rationale for the benefits of a local accommodation levy ( link )- The Guardian – context on the Edinburgh example and existing local charges in the UK ( link )
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