England’s Mayors to Impose Tourist Tax
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England’s Mayors to Get Power to Impose Tourist Tax
Image source: Getty Images
Image caption: York, pictured, is one of the cities where the regional mayor plans to explore a tourist tax
By Ewan Somerville, Political reporter, Jack Fenwick, Political correspondent, and Chris Graham
Published 10 September 2026, 03:19 BST
Updated 26 minutes ago
Mayors in England will be given the power to impose a new fee on overnight stays, in a move the government says will mean more money can be invested into local areas.
Under the plans, local leaders will be able to bring in an uncapped levy, dubbed a "tourist tax", as a percentage of the cost of hotels, bed and breakfasts, and other types of accommodation rather than a flat fee.
Hospitality leaders have warned it will put jobs at risk and hit families in the pocket.
However, the government said it would protect budget holidays by ensuring low-cost accommodation always pays the lowest levy and stated the extra cash could be invested in high streets and local transport.
Local Government Secretary Angela Rayner said:
"This measure will give mayors the choice to raise and reinvest funding where it’s needed most. It’ll help support the local services, public spaces, and attractions that both residents and visitors rely on, with decisions taken by people who know their area best."
Some mayors have backed the move, while others have expressed caution or signalled they will not bring it in.
Local leaders, including heads of Foundation Strategic Authorities where there is no mayor, will need to clarify by early 2028 how the revenue raised should be reinvested.
They will also be allowed to offer exemptions, such as for campsites. However, mayors will not be allowed to exempt whole localities within their regions from the tax to avoid creating confusion for visitors and businesses.
The government said it would introduce a bill to Parliament "in due course" to bring in the levy.
Reaction
Leading trade body UKHospitality has hit back, saying the levy means "jobs are now at risk". Its chief executive Allen Simpson claimed it would add about £100 to £120 on average to the cost of a family holiday in England, amid fears mayors would make use of the fact there is, in theory, no upper limit for the levy.
"We know, don’t we, that local government is struggling for funds – it was hit very hard by austerity," he told BBC Radio 4’s Today programme.
"If you only devolve one tax-raising power, of course local mayors are going to pull that lever until it snaps."
He added: "It will be the case that you’ll have holiday parks which can’t open in the shoulder seasons [between peak and low season] and of course people who go on holiday will just have that little bit less money in their pocket."
Conservative shadow housing secretary David Simmonds said:
"VAT is already charged at 20% on hotels – much higher than in other countries – and now they’ll pay VAT on this tourism tax too: a Labour double whammy."
Reform UK leader Nigel Farage said his party’s two mayors in Greater Lincolnshire and Hull and East Yorkshire "won’t touch" the levy, which he branded a "holiday tax".
Idea and Similar Schemes
The idea was first raised under former Prime Minister Sir Keir Starmer in November and is similar to schemes running in Scotland and European destinations.
Two cities in England already run their own voluntary schemes – a £1 per room, per night City of York tax and a 5% levy in Edinburgh introduced in July.
