Plans to introduce a tourism tax in Wales have cleared the first hurdle in the Senedd, with the Welsh Government proposing rates of £1.30 per night per person. ✈️🏴
Senedd members voted 40-15 in favour of the tourism tax bill following a debate on April 1, during which ministers announced plans to create an exemption for children.
If the bill completes its passage through the Welsh Parliament, a rate of £1.30 per person (before VAT) could be charged on overnight stays in hotels, B&Bs and self-catering accommodation. A lower rate of 80p would apply to hostels and campsites.
The legislation would give the 22 Welsh councils powers to decide whether to introduce a local levy from 2027 at the earliest.
Finance Secretary Mark Drakeford led the debate, stressing that councils would have “an option rather than an obligation” to bring in a levy. The former first minister argued the levy – which he said “would cost less than a sausage roll” – will be “simple, straightforward and fair,” with lower rates than in comparable destinations.
However, Conservative Shadow Finance Secretary Sam Rowlands warned that “tourism providers are deeply concerned about the proposed tax,” with the sector accounting for around one in eight jobs. He urged ministers to “axe the tax” and opposed what he called an “assault” on the tourism sector.
An estimated £264m would be raised if all councils chose to introduce the levy in the decade to 2035, against total costs of £313m to £576m, according to an impact assessment.
The bill, which was introduced as part of the Welsh Government’s co-operation agreement with Plaid Cymru between 2021 and 2024, now moves to stage two for detailed amendments in the finance committee.
