A blanket visitor levy would damage tourism in East Riding.

East Riding Lib Dems agree with Hull and East Riding Mayor. No Levy. ...

The Liberal Democrat Stance on the Visitor Levy: A Victory for the Principle, a Critique of the Execution.

​The Liberal Democrats have long championed the principle of a Visitor Levy (often called a 'tourism tax'), arguing that popular destinations should have the power to raise revenue to offset the pressure tourism places on local infrastructure and services. The party welcomed the Government's decision in the recent Budget to introduce the levy powers, calling it a victory for their campaign.  

​However, the party has been highly critical of the execution, specifically the Government's decision to delegate these powers to regional Mayors rather than directly to local councils. For the Liberal Democrats, this is seen as an unnecessary "power grab" by central regional individuals that undermines genuine local decision-making.  

​The Problem with Delegation: Regional Mayors vs. Local Councils

​The core of the Liberal Democrat objection is one of local autonomy and direct accountability. They argue that the costs and benefits of tourism are felt at the hyper-local level, and therefore, the revenue and the power to introduce the tax should reside with the directly elected local councils.

​Cllr Victor Chamberlain, Southwark Liberal Democrat Group Leader

“Whilst we welcome the Tourist Tax announcement – which we have been calling on for years – local councils must see that money instead of it sitting in Sadiq Khan's pocket, and the hospitality industry should also see some relief from national insurance, as well as our proposals for an emergency VAT cut of 5%.”  

​Delegating the power to Mayoral Combined Authorities (MCAs) creates a bureaucratic layer, meaning the revenue collected may not be ring-fenced or directly invested back into the specific local area that generated the funds, frustrating the very purpose of the tax.

​Liberal Democrat groups in high-footfall areas have been at the forefront of the campaign for the levy, clearly articulating its purpose:  

Liberal Democrat controlled ​Bath & North East Somerset Council, attracts approximately six million visitors annually, has been a key campaigner. Bath MP Wera Hobhouse welcomed the news but stressed the importance of local investment.  

​“I'm proud that so many people visit and love Bath, but hosting millions of tourists each year puts real pressure on our city. A small, fair tourist levy would help us protect our heritage and support local services, so that residents and visitors alike can enjoy Bath at its best.”  

​York Liberal Democras actively campaigned for the levy, anticipating it could raise an estimated £11 million per year for the city. They are demanding a firm guarantee that the money raised will be reinvested in local priorities such as street cleaning, maintaining roads, and public toilets, to address the "growing mismatch between what residents pay and what they receive."  

​Southwark Liberal Democrats has called for a Tourist Tax, citing Manchester's new £1 per night 'city visitor charge' as a model that could be adapted to fund local communities and high streets in the borough.  

​While generally supportive of the principle of local funding mechanisms, the situation in Cornwall highlights a critical concern. Unlike cities relying heavily on international visitors, Cornwall, Devon, and the East Riding of Yorkshire are heavily dependent on domestic tourism. For instance, in St Ives, overseas visitors contribute an estimated £10 million annually, compared to £57 million from UK visitors. Any new tax risks reducing visitor numbers in a region that has already seen a decline of 10-12% in tourists in 2024 due to rising costs, disproportionately affecting local businesses.  

"This levy may be beneficial in larger conurbations where it is raised in the area by businesses who then will benefit from strategies implemented in promoting tourism locally .

 In an area where business is diverse and widely spread between city , coastal, rural this would deter visitors , dilute the revenue generated and benefit only the city areas where the bulk would be invested" 

Cllr Dale NeedhamChair of HEYHA , Hull , Humber & East Yorkshire Hospitality Association . Board member of LVEP -VHEY , Local Visitor Enterprise Partnership , Visit Hull & East Yorkshire.

Some areas are also concerned that Mayors may use the powers to raise funds for other projects and place blanket levy on regions, regardless of the local impacts.  

"Bridlington and coastal tourism has suffered significantly over recent decades, impacting the local economy. Whilst a visitor levy might benefit cities like York with high international visitor numbers, East Riding of Yorkshire relies more heavily on the domestic market, and anything that pushes up prices puts family-run businesses at risk. If anything, the government needs to be doing more to support the hospitality and accommodation sector in areas like Bridlington. That's why the Liberal Democrats are calling on the government to cut VAT to 15% for these areas. We agree the Hull and East Riding Mayor, that the visitor levy should not be a blanket tax for the region, and the the Liberal Democrats will defend local family-run businesses to ensure it never is." Cllr Jayne Phoenix East Riding Liberal Democrats 

​Protecting the Hospitality Sector: The VAT Cut Proposal

​The Liberal Democrats acknowledge the significant financial pressures on the hospitality and accommodation sectors, which are vital to the visitor economy but are struggling with high operating costs.  

​To mitigate the risk of a new levy deterring visitors and further burdening businesses, the party has proposed an emergency economic measure: an immediate cut in VAT for the hospitality, accommodation, and attractions sectors from 20% to 15%.  

​This proposed 17-month cut, estimated by the Liberal Democrats to cost around £7.5 billion in total, is intended as an immediate boost to struggling high streets.  

​This measure would save the average UK household around £135 over the period, making domestic trips more affordable and boosting footfall in pubs, restaurants, and hotels.

"High street businesses have been hammered by the jobs tax and higher business rates bills, so it's no wonder that so many treasured pubs, restaurants and cafes are boarding up their shopfronts, taking with them vital jobs and local community spaces."  

​"The Government must throw our hospitality sector a lifeline. They must urgently fix this mess by using its powers to lower business rates and bring in the emergency hospitality VAT cut we Liberal Democrats have been calling for to save our high streets." Daisy Cooper MP, Liberal Democrat Deputy Leader and Treasury Spokesperson, 

​Liberal Democrat Policy Links

​Liberal Democrat Press Release on Hospitality VAT Cut ​https://www.libdems.org.uk/press/release/lib-dems-call-for-emergency-hospitality-vat-cut-at-budget-as-families-priced-out-of-both-keeping-warm-and-going-out