A popular Scottish city is set to introduce tourist tax

From mid-2026, Edinburgh will impose a 5% accommodation fee for stays in hotels, B&Bs, and other lodgings, capped at five nights. This first-of-its-kind charge in the UK aims to raise £45-50 million annually by 2028. Despite some opposition, the f...

By ET Online | Feb 25, 2025, 11.38 AM IST

From mid-2026, visitors staying in certain types of accommodation, such as a hotel, bed and breakfast, hostel, self-catering apartment or guest house in Edinburgh, will be charged a fee of 5% of their accommodation cost per night. The charge is capped at five consecutive nights, according to the local authority. This is the first charge of its kind in the United Kingdom.

Accommodation providers will be in charge of collecting the fee on behalf of the authorities. In 2023, Edinburgh welcomed nearly 5 million overnight visitors, contributing £2.2 billion ($2.7 billion) to the economy, according to Visit Scotland’s website. The council anticipates that the new fee will generate between £45 million and £50 million ($56-62 million) annually by 2028 or 2029.

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A tourist tax in Edinburgh has been under discussion since 2018 and became possible when the Visitor Levy (Scotland) Act came into effect in July. Under the act, revenue from the levy must be used to support local facilities and services that business and leisure visitors use heavily, according to the City of Edinburgh Council website.

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Some councillors said ahead of the vote that they wanted the charge to be higher, expressing a desire for revenue generated from the levy to be spent on giving residents affordable housing, with housing said to be currently too costly for many people working in hospitality.

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After a draft visitor levy was introduced in August, local residents and businesses were consulted. Slightly more than half of residents and businesses supported a 5% charge, while the majority of visitors (62%) opposed the levy or felt it should be lower, according to a local authority notice.

Initially, the charge was set to apply for up to seven nights, but this was reduced to five following input from Visit Scotland and Edinburgh Festivals, which pointed out that performers and festival workers often stay for several weeks during events.

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