Visitor Levy (Scotland) Bill - stage 3 debate: Investment Minister statement

Thank you Presiding Officer. Before I turn to the content of the Bill itself I want to thank members for the thoughtful and constructive way many of them have engaged with it as it has progressed through Parliament. Members have put forward their views and arguments in a measured way in Committee, in the chamber and in my own individual meetings with them. I believe that scrutiny process has improved the Bill and shown the Parliament in a good light.

On the substance of the Bill I strongly believe that a visitor levy can be a force for good. It is a measure that can bring benefits to visitors, residents and businesses. It has the potential to be an important tool enabling investment in the local economy and supporting an important industry in Scotland.

Visitor levies are common in many parts of the world but I am proud that if passed this Bill will create the opportunity for the first true visitor levy in the UK. 21 European countries have some kind of visitor levy and I believe it is right that Scotland has the ability to add to that number.

The measures in the Bill reflect good practice from around the world and our own particular context in Scotland. I will turn to each of the features of international good practice, as highlighted by the European Tourism Association, in turn, and discuss them in relation to the Bill.

The first important factor is that genuine, effective, local consultation is carried out before any visitor levy is introduced.

The Bill will therefore require local consultation before introducing, or modifying, a visitor levy scheme. That consultation must involve communities, businesses engaged in tourism and local tourist organisations.  Furthermore we have considered today amendments that would strengthen that ongoing consultation and engagement, with the creation of a Visitor Levy Forum.

Another element that is highlighted as good practice internationally is for it to clear and transparent where funding raised by a visitor levy is being used. We know from our own consultation and engagement that is also important to the tourism industry here in Scotland.

The Bill therefore puts in place clear parameters around how the funding raised by a levy is used. As members will know the funding can only be used to develop, support, or sustain facilities or services which are substantially for, or used by, those visiting an area for leisure or business purposes.  That definition was adjusted as the Bill moved through Parliament, recognising the views of the Local Government, Housing and Planning Committee at stage 1 – another example of where the scrutiny process has improved the Bill.

That position on funding gives local authorities the flexibility to use the funding raised by a levy in the best way that supports the visitor economy in their area. For example, that could include street dressing, or promotion of a particular destination.  It could support housing where such housing is necessary to address recruitment and retention issues in the tourism sector.  It could include investing in regeneration work that is required to facilitate investment by the private sector in a new hotel or tourist attraction.

The Government has purposely not specified exactly how the funding should be used. What we have sought to do in the Bill is put in place a structure and process that means, within broad parameters, decisions can be made locally that support the local economy.

A suitable notice period for the introduction of, or changes to, a visitor levy is another feature of international good practice. That also reflects the strongly held position of business in Scotland.  That is why the Government has consistently said that a suitable length of implementation period is necessary, to give businesses and local authorities time to prepare their systems, train staff, and carry out other necessary preparations.

Lastly in terms of good practice internationally any visitor levy should be easy to pay, collect, and remit. The Bill therefore puts in place a robust process, with a suitable level of local discretion, for collecting and remitting a visitor levy.  The calculation of the level of visitor levy is straightforward, and importantly reflects the cost of the accommodation a visitor has decided to book. 

The Bill also puts in place a clear process for any compliance and enforcement action. We do not expect such tools to be used often.  However, it is important they are there to provide local authorities with what they need to address actions by those who, for example, deliberately seek to avoid a visitor levy.

The Bill of course will not stand alone. Last year I asked Visit Scotland to convene an expert group and invited local government and business organisations to sit on it.  That group’s purpose is to develop guidance for local authorities seeking to introduce a visitor levy in their area.

Over the last months it has worked to bring together guidance that draws on the knowledge and experience of the tourism sector and local government. That guidance will, as a result of the scrutiny of the Bill at stage 2, as I've said, be on a statutory footing.  It is a key element in getting a visitor levy right for Scotland and I want to put on record my thanks to those who sit on the expert group or who otherwise support its work.

Presiding Officer, as I said at the start of my remarks this Bill is an important measure. If passed it will give local authorities a significant new tax power.  That is not something that the Government has proposed lightly and it follows considerable engagement and discussion over many years.

In the Bill the Government has sought to strike the right balance between national consistency and local flexibility. I believe we have stuck the right balance.  I welcome the improvements to the Bill that have come about from engagement and amendment and I ask that the Parliament supports it.