Visitor Levy Consultation

What is a visitor levy?

A visitor levy is a charge applied to overnight stays in paid accommodation. It is paid by visitors and collected by accommodation providers, with proceeds ring‑fenced for tourism‑related purposes.

Why is East Lothian considering a visitor levy?

Tourism makes a significant contribution to East Lothian's economy and supports local businesses, jobs and communities. Visitor activity can also create additional demands on infrastructure, facilities and services, particularly during busy periods. A visitor levy has the potential to generate additional funding which, if introduced, would be used in accordance with the Visitor Levy (Scotland) Act 2024 to support, develop or sustain facilities and services substantially for or used by visitors.

Who would have to pay the levy?

The levy would primarily be paid by visitors staying overnight in paid accommodation in East Lothian. However, it would also apply to East Lothian residents if they choose to stay in paid accommodation within the Council area that is not their sole or main residence, unless they qualify for a statutory exemption. 

How much would the levy cost?

The draft proposal is for a levy of 5% of the accommodation charge. For illustration, a one-night stay costing £100 would incur a Visitor Levy of £5. A one-night stay costing £60 would incur a Visitor Levy of £3.

The levy would apply to the accommodation charge only and would not apply to charges for meals, drinks, parking or other services.

Why is the proposed rate 5%?

The draft scheme proposes a 5% levy based on analysis undertaken for East Lothian Council, stakeholder engagement and consideration of visitor levy schemes being developed elsewhere in Scotland. As part of this work, a range of alternative approaches were assessed, including lower and higher percentage rates, fixed-charge models and different exemption arrangements. The Council is consulting on the proposed 5% rate and welcomes views on whether it is appropriate.

Which accommodation types would be included?

Hotels, guest houses, bed and breakfasts, self‑catering accommodation (including short‑term lets), hostels, and paid camping and caravanning accommodation located within East Lothian.

Why is the levy proposed to apply across the whole of East Lothian? 

The Draft Scheme proposes that the levy would apply across the entire East Lothian Council area. The Council considered that a consistent approach would be simpler for visitors and accommodation providers and easier to administer. The Council is consulting on this proposed approach.

Why doesn't the draft scheme include a cap on chargeable nights?

The Draft Scheme proposes that the levy would apply to the full duration of an overnight stay, with no cap on the number of chargeable nights. This approach was informed by the Council's evidence gathering and analysis and reflects the proposed design of the Draft Scheme. The Council is consulting on this approach and welcomes views on whether it is appropriate.

Why is the levy proposed to apply throughout the year?

The Draft Scheme proposes that the levy would apply throughout the year, with no seasonal variation. This approach was informed by the Council's evidence gathering and analysis and reflects the proposed design of the Draft Scheme. The Council is consulting on this approach and welcomes views on whether it is appropriate.

Why are accommodation providers allowed to retain 2%?

The draft scheme proposes that accommodation providers may retain 2% of the levy revenues they collect to contribute towards the costs of administering, collecting and remitting the levy. The council is consulting on this proposed arrangement. 

Are any groups exempt?

Yes. Statutory exemptions apply as set out in the Visitor Levy (Scotland) Act 2024, including certain people who are homeless or at risk of homelessness, asylum seekers and refugees, and people in receipt of specified disability-related benefits. The Draft Scheme also proposes a discretionary exemption for certain charitable accommodation providers where permitted by the Act.

How much money could the levy raise?

Modelling suggests that a 5% levy could generate around £1.5 million per year in gross revenue, with around £1.2 million per year remaining after administration and collection costs. However, actual revenue would depend on the final scheme design, visitor numbers and other factors. 

How would the money be spent?

Net proceeds would be ring-fenced and used in accordance with the Visitor Levy (Scotland) Act 2024 to support, develop or sustain facilities and services substantially for or used by visitors. The draft scheme identifies potential areas of investment.

Who decides how the money is spent?

Spending decisions would be made by East Lothian Council. The Council would be supported by advice from local statutory Visitor Levy Forum comprising representatives of tourism businesses, communities and relevant organisations, which would provide advice on the operation of the scheme and the use of net proceeds. 

When would the levy start?

If introduced, the levy could not begin until at least 18 months after a final Council decision. The commencement date would be determined by the Council following consideration of consultation responses.

Has East Lothian Council already decided to introduce a Visitor Levy?

No. The Council is currently consulting on a draft scheme proposal. Consultation responses will be considered alongside the wider evidence base before the Council decides whether or not to introduce a Visitor Levy in East Lothian.

How can I have my say?

You can respond to the consultation survey and provide comments on any aspect of the proposal. You can also contact the Council on visitorlevy@eastlothian.gov.uk to share any other views or feedback.