Visitor levy or visitor investment? M&IT editor Paul Harvey on why business events should care about the new overnight tax powers...
The idea of a visitor levy has long been one of those policy
debates that instantly generates more heat than light.
Critics call it a “tourist tax”. Supporters frame it as a
practical way for destinations to reinvest in the infrastructure and promotion
that keeps visitors coming in the first place. Now, with the Overnight Visitor
Levy Bill included in this week’s King’s Speech, the debate is no longer theoretical
for England’s meetings and events sector.
When it comes into law, the proposal will give English
mayors and regional authorities powers to introduce overnight accommodation
charges, bringing England closer to systems already operating - or emerging -
in Scotland, Wales and much of Europe.
For corporate event planners, the immediate reaction is probably
quite straightforward: great, another cost.
That concern is understandable, event budgets are already
the number one issue for a majority of planners. But there is an argument to say we should resist the
temptation to view the levy purely through the lens of cost. The more important
question is - what happens to the money?
If revenues disappear into general local authority budgets,
industry concerns will harden quickly. But if levies are genuinely ringfenced
to support destination marketing, convention bureaux, venue infrastructure,
transport improvements and event attraction funds, the conversation becomes
more nuanced.
Struggle to compete
The reality is that many UK destinations already struggle to
compete internationally because they lack consistent long-term funding models
for business events. Convention bureaux are often expected to attract major
congresses, conferences and incentive programmes while operating on
comparatively fragile budgets.
In the United States, hotel occupancy taxes have helped fund
destination marketing and convention activity for decades. Closer to home,
Manchester and Liverpool have already introduced industry-backed accommodation
levies through Accommodation Business Improvement Districts (ABIDs), helping generate funding for destination promotion and
event attraction activity. Edinburgh has now gone further, with part of its new
statutory visitor levy directly supporting its convention bureau.
Business events do not arrive by accident. Winning
international conferences and major corporate events requires sustained
investment, bid support, marketing, air connectivity partnerships and
subvention funding.
At the same time, there is a legitimate concern about
cumulative cost pressure on the UK visitor economy.
Expensive destination
The UK is already perceived by many international visitors
as an expensive destination, particularly when visa costs, Air Passenger Duty
and accommodation pricing are factored in. Industry bodies including ABTA and
UKinbound warn that poorly designed levies could damage competitiveness if they
become overly complex, inconsistent between regions or simply too expensive.
For business events, the operational detail will matter
enormously.
Will planners face different charging systems in different
cities? Will levies apply to group bookings and contracted rates? Will there be
exemptions, and for whom? How will charges appear on
hotel invoices? And crucially, will we be able to clearly see where the money
is being reinvested?
Planners are unlikely to object strongly to a modest
overnight levy if they can see tangible benefits: better connectivity, cleaner
public spaces, stronger destination support, improved delegate experiences and
more ambitious event attraction strategies.
Not just another tax
What they will resist is the sense of paying more while
receiving nothing in return.
The challenge for government - and for local authorities -
is to ensure this does not become simply another tax attached to travel.
For years, business events have generated billions in
economic impact while often sitting awkwardly between tourism policy, economic
development and inward investment strategies. A properly structured levy could
help provide more sustainable funding for destinations at a time when public
finances remain stretched.
But only if the industry is treated as a stakeholder in how
the system is designed.
M&IT editor Paul Harvey is a journalist with more than 15 years of experience. He began his career in the local press, working for various titles across the north. Since joining M&IT in 2013, he has become a trusted and respected voice in the sector, championing event professionals and reporting on all aspects of the events industry for the brand.
