Official Guide to Edinburgh
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Edinburgh Residents and Visitors Open to a 'Tourist Tax'

Residents in favour and an overwhelming majority of visitors would still come to Edinburgh if levy introduced

13 September 2018

A survey asking residents and visitors for their views on the potential introduction of a tourist tax – or Transient Visitor Levy (TVL) - for Edinburgh has found that the majority of locals are supportive of the idea and visitors would not be put off coming to the Capital.

The independent research, carried out by Progressive Partnership and commissioned by Marketing Edinburgh,  took place in July and August 2018 to assess views during the busy festival season.

It finds that the introduction of a transient visitor levy would not discourage visitors.  The research confirms that 92% of tourists said that they would have visited Edinburgh even if a Tourist Levy of £1 per room, per night were in operation.  78% said they would still come, even if the tax was as high as £4 per room, per night.  Research also found that an equal number of visitors were in support of the levy as were against (47% for, 47% against).

This is the first time residents and visitors to Edinburgh have been asked for their views on the issue. It was found that the majority of residents were in favour - with 59% saying they were supportive of a transient visitor levy introduced in the city, and 55% aware of The City of Edinburgh Council’s proposals to introduce a tourist levy in the city. When asked about drawbacks, 45% of residents were concerned about putting tourists off - a concern addressed by the findings that an overwhelming majority of visitors would still come to Edinburgh even if a tax were in place. 25% were ‘totally in favour of the tax’, while only 12% of residents were ‘totally against the tax’.

519 residents (evenly split between those living in and around the city centre, and those living in other parts of the city) and 561 paying overnight visitors (10% from Scotland, 35% from the rest of the UK, 56% overseas – broadly reflective of actual visitor numbers) were asked for their views in the survey, which also shed light on how people would like a visitor levy to be operated if one should be introduced:

Both visitors and residents preferred a flat rate charge levied on accommodation over a charge on other services such as taxis or restaurants as this was easier to understand, but those equally concerned with the fairness of a charge supported a percentage. Residents felt a £5.20 charge on a £100 room fee would be reasonable, while visitors suggested £3.40. 

Those questioned also had views on how a potential tourist tax would be spent, with 54% of visitors and 28% of residents hoping to see it spent on public areas where there are many tourists. 28% of residents felt the money raised from a tax should be spent on roads. 12% of visitors felt a tax should be spent on festivals and events, while 8% of residents felt this way.

Marketing Edinburgh hope this data will further the discussion on ways to manage the Capital’s success as a world leading visitor destination.

John Donnelly, Chief Executive, Marketing Edinburgh, said:

“We need to find a solution that enables sustainable investment in Edinburgh’s growing tourism industry while supporting the council to manage the consequences of that success. Transient Visitor Levies are used widely throughout the world and to great effect, raising significant amounts of money, so it’s important that we put this option on the table, with a goal of reinvesting funds into keeping the city at its best, to the benefit of residents, visitors and businesses alike.

It’s a topic that’s now being widely discussed nationally, although what has been missing from that conversation so far is the views of residents and visitors. This insight demonstrates that visitors would not be put off coming to Edinburgh, and indeed the majority of residents support it so long as it isn’t to the detriment of tourism within the city.

A city-wide discussion with Edinburgh’s businesses is now underway and, with the views of residents and visitors in mind, we can now confidently debate the facts.’

Transient visitor levies are operated successfully in a number of other European cities, and this latest research found that 39% of visitors recall paying a tourist tax at other locations, with just 4% of all visitors reporting changes to their plans as a result of a tourist tax.

A further wave of 300 visitors will be questioned in October using the same questions to enable price sensitivity testing outside of the main tourist season.

Key findings

Both visitors and residents preferred

- a charge levied on accommodation over a charge on other services such as taxis or restaurants.

- flat rates for rooms, then a proportion based on the total, then a per-person rate. Amongst those who favoured a percentage rate, around one seventh of residents (14%) and just less than one in five visitors (18%) said this was because those who could afford it would pay more.

While results were inconclusive on whether visitors were for or against a tourist tax, overwhelmingly, it was found that it would not put them off visiting:

- 47% of visitors were in favour of a tourist tax, 47% were against however, 78% said they would still have visited Edinburgh even if the charge were as high as £4 per room per night.

- 39% of visitors recall paying a tourist tax at other locations. 4% of all visitors report changing their plans in the past as a result of a tourist tax.

- If a £2 per room, per night charge were introduced, 78% of visitors said their plans would not have changed, while 3% said they would not have visited Edinburgh. With only a £1 charge, 88% would not have changed their plans. At a £4 charge, 6% said they would not have visited Edinburgh. However, again, 78% said they would still have visited Edinburgh even if the charge were as high as £4 per room per night.

- 54% would want to see a tourist tax spent on public areas where there are many tourists, while 12% felt it should go towards festivals and events.

Residents were in favour of a tourist tax and though they were less likely to have personally paid a tourist tax than visitors, they were aware of the issue and knew it was being discussed in Edinburgh.

- 59% of residents were in favour of a tourist tax, 32% were against. At the extreme ends of the scale, 25% of residents were 10/10 “totally in favour of the tax” while 12% were 1/10 “totally against the tax”.

-36% of residents had paid a tourist tax in the past, and only 4% of all residents had ever changed their travel plans as a result of a tourist tax.

- 55% knew the Council was trying to introduce a tourist tax in Edinburgh.

- 49% felt a TVL would raise more money generally, 18% felt it would raise more for residents’ services, 17% thought it would mitigate the impacts of tourists. Only 10% felt the tourist tax would create no benefits.

- 28% of residents felt the money raised from any tax should go towards roads, 28% said it should be spent on tourist areas, while 8% felt it should be spent on festivals or events.

- When asked about the drawbacks, 45% felt it would have an impact on tourism or where tourists stayed. 13% felt residents would not benefit from the money or that the money would not be wisely spent. However, 27% felt there would be no drawbacks.