UK Tourist Tax: Exploring the Rise of Visitor Levies & Foreign Property Charges

In recent years, the idea of a UK tourist tax has gained prominence, with local authorities, in particular, looking to manage the negative effects of overtourism while still attracting visitors to generate much-needed revenue. Some big cities like Manchester and Edinburgh have already started with these taxes and Wales has also now passed legislation to do the same.

So, are we on our way to having a national tourist tax? If so, will we be an outlier on the international stage or part of a large group? What could a UK tourist tax look like? Let’s discuss.

What is a Tourist Tax?

A tourist tax, sometimes known as an overnight levy or visitor levy, is a small charge added to the cost of accommodations, such as hotel stays, Airbnb bookings, or holiday lets. These levies are usually collected by accommodation providers and passed on to local governments.

These taxes aren’t really popular among tourists and tourism businesses but governments often justify them with the “user pays” principle. The concept is that visitors should contribute to the maintenance of the destinations they use. Still, local businesses and hospitality operators worry that they will make areas more expensive (and hence, less attractive) to travellers and will hurt their incomes.

How Do Existing UK Tourist Taxes Work?

The UK currently does not have a nationwide tourist tax, but there are some versions of it at the local and regional levels.

Scotland

In 2022, the Scottish Government passed legislation allowing local councils to introduce a visitor levy. Taking the lead in this initiative, Edinburgh is set to become the first city in the UK to charge tourists a formal accommodation tax, starting 24 July 2026. This will be a 5% levy on overnight stays in the city. Glasgow has also approved a similar 5% tourist tax, which is expected to come into force in 2027.

These levies will apply across all accommodation types, including hotels, short-term rentals, and campsites, and the revenue generated will be used to support local infrastructure and cultural initiatives, according to media reports.

Wales

The Welsh Senedd also passed a law this month, empowering local councils to introduce and implement tourist taxes from 2027. The law will add £1.30 per night to the price of most overnight stays in Wales. However, there are reduced rates for accommodations in hostels and campsites, as well as exemptions for children under 18 and those staying for more than 31 nights.

Furthermore, this tax won’t be applied uniformly across all regions of Wales. The law allows regional councils to decide for themselves whether to introduce it in their area or not. Proponents of this law, though, say adopting it will help communities manage tourism pressures like overcrowding and infrastructure wear.

England

England currently does not have a tourist tax and local authorities lack the power to introduce one independently. However, cities like Manchester and Liverpool have established voluntary schemes through Business Improvement Districts (BIDs).

Manchester’s ‘city visitor charge,’ introduced in April 2023, is a £1-per-night levy collected by hotels and used to fund regional tourism development.

Other cities, including Bath and Oxford, have shown interest in similar schemes, but no official government-backed tourist taxes exist.

What’s the Local Reaction & Industry Response?

Supporters argue that tourist taxes are modest and help alleviate the financial strain that tourism places on public services, such as transportation and waste management. In tourism-dependent areas like Edinburgh and Snowdonia, these visitor levies are also seen as tools to protect natural and cultural heritage sites.

However, hospitality groups worry that these taxes, no matter how small, may appear off-putting to visitors and can give them a sense of being penalised, especially if their home area or country does not have similar tourist taxation provisions. This, in turn, will harm their sector, especially as it’s just now starting to find its footing after the COVID-19 pandemic.

The Scottish Tourism Alliance has also warned that these costs will reduce competitiveness and dissuade budget travellers, potentially disadvantaging UK destinations compared to alternatives across the Europe and around the world.

Then There’s What Spain Did: Property Tax for Foreigners

Beyond tourist levies, Spain has recently moved to address the impact of foreign investment on its housing market. In May 2025, Spain’s government submitted a draft bill proposing a 100% tax on property purchases by non-resident, non-EU nationals. The measure aims to curb rising property prices and housing shortages driven by foreign buyers.

The draft legislation has not yet been enacted into law. If passed, it would significantly affect foreign buyers, including those from the UK, as it is not an EU member, creating a new dimension of property-related charges linked to tourism.

In regions like the Balearic Islands and cities such as Barcelona, authorities have already taken steps to limit tourist-focused property use, including cracking down on short-term rentals and reducing licences for holiday apartments. Although not a direct tax, these regulatory moves reflect similar concerns about balancing tourism growth with local housing needs.

International Comparisons: Tourist Taxes Around the World

Tourist taxes aren’t exactly uncommon around Europe and the world. Below is a list of some countries that implement it in one form or the other:

• France – Imposes a “taxe de séjour,” best explained as a nightly charge varying by accommodation type and rating to fund tourism infrastructure.
• Italy – Charges a “tassa di soggiorno” or a tourist tax, which varies by city and accommodation, and contributes to the conservation of historic sites.
• The Netherlands - Dutch municipalities collect a “toeristenbelasting (tourist tax)” on overnight stays in paid accommodations like hotels, B&Bs, campsites and short‑term rentals.
• New Zealand - Charges a NZD100 International Visitor Conservation and Tourism Levy (IVL).
• Japan - Enforces a ¥1,000 departure tax to fund tourism infrastructure.

Conclusion

Visitors, whether short-term tourists or long-term property owners, are increasingly being expected to bear a share of the financial costs associated with their presence.

The latest Welsh tax has also ignited a debate in the UK and, judging by the way the wind is blowing, travellers and investors must be prepared for a shifting fiscal landscape.