Cruise Ship Levy: consultation analysis

Executive Summary

The Scottish Government held a public consultation seeking views on granting local authorities the ability to introduce a levy on cruise ship passengers arriving in their area. It ran from 27 February 2025 until 30 May 2025. The consultation paper was published alongside a Partial Business and Regulatory Impact Assessment and was informed by roundtable events held around Scotland.

The consultation included 17 closed questions and 10 open questions. Most open questions asked respondents to explain their answer to the corresponding closed question. In total, 207 consultation responses were received. Individuals provided 132 responses to the consultation; the remaining 75 responses were from organisations.

Views on a potential cruise ship levy

Just over three fifths (62%) of respondents who answered supported giving local authorities the power to create a cruise ship levy in their area, while one third (34%) opposed the proposal, and 5% were unsure. Support was higher among individuals who answered (73%) than organisations (39%). Many respondents provided reasons for their support. Of those, the most common was that a levy could help mitigate the impact of cruise ship tourism on affected communities. Conversely, many respondents were against the proposal, suggesting that a cruise ship levy could negatively impact tourism by discouraging cruise ship operators from visiting certain ports, particularly smaller ports, and reduce cruise tourism to Scotland generally.

The need for further information about the potential levy was highlighted by some respondents throughout the consultation. Respondents requested further details on the purpose and goals of the proposed levy, a more complete BRIA, and greater consideration of any unintended consequences resulting from the levy.

Many respondents expressed the view that no alternative to a cruise ship levy would achieve the same goals. Some noted a preference for a point of entry levy and some others felt that collaboration between cruise operators, local authorities and central government could improve community resources and diminish the impact of cruise ship tourism.

Basis of the cruise ship levy

Respondents were asked what the primary basis of any proposed cruise ship levy should be. Overall, the most favoured option for a levy was the number of passengers to disembark from a ship (25%), followed by the number of passengers on board a ship (20%). However, almost one in five (18%) were unsure, and 13% selected ‘other’.

Respondents highlighted that the basis of the levy should align with the rationale behind the levy. For example, a levy based on passengers disembarking aligned with the rationale that the levy was meant to mitigate the impact of cruise visitors on affected communities. Some concerns raised by respondents included concerns about any administrative burden and that the levy may alter passenger movements, e.g., a levy on disembarking passengers may stop some from going ashore to avoid additional costs.

Respondents were asked whether the basis for the levy should consider the environmental impact as well, and just over half (52%) of those answering agreed, 37% disagreed, and 11% were unsure. While two thirds (68%) of individuals felt this should be the case, the same proportion (67%) of organisations disagreed.

Collection, calculation and compliance

Local authorities were seen as the most appropriate body to collect any cruise ship levy by those answering (35%) and by both individuals (34%) and organisations (36%). While one quarter (24%) of those answering felt the port operator should be responsible, this was more heavily favoured by individuals than organisations (29% and 14% respectively). Many respondents detailed why they felt local authorities should calculate and collect any cruise ship levy, although only one local authority supported local authority collection. Reasons included a belief that if local authorities want to implement a levy, it should be their responsibility to calculate and collect it. In contrast, some felt the operational burden may be too significant, or questioned whether the revenue raised by any levy would cover the costs of administering it.

When asked about enforcing any cruise ship levy, 59% of all respondents felt the responsible body should have the power to apply a penalty if a cruise ship levy is not paid when it is required to be. The power to request, and obtain or inspect, the information necessary to assess the cruise ship levy liability of a body was supported by 57%, while over half (54%) supported introducing the power to apply a penalty if a body provides inaccurate information regarding a cruise ship levy or destroys requested information.

Rate of any cruise ship levy

The consultation sought respondents’ views on whether the rate of the proposed levy should be set at the national or local authority level. Over half (57%) of those answering felt the rate should be decided by local authorities. This was preferred by both individuals and organisations. Many respondents favoured local authorities deciding the rate as they felt local authorities are best placed to take a responsive and flexible approach. For example, there is a wide geographic spread and diversity of areas and communities affected by cruise tourism, and a uniform national rate could fail to account for these regional differences. However, many respondents highlighted concerns or potential challenges that could arise if local authorities set the levy rate, such as the operational and administrative demands that could be placed on local authorities.

Many respondents supported setting the rate nationally, with several expressing the view that this approach could avoid local competition and would be fairer, as no port would have a price advantage over another. In contrast, a few respondents felt that setting a cruise ship levy at a national level could disadvantage Scotland against other countries that welcome cruise tourism.

Respondents were also asked whether there should be an upper limit if the levy is set at the local level. Of those responding, 58% felt that if the rate of any cruise ship levy was set by individual local authorities, then an upper limit should be set at a national level. Three in ten (31%) disagreed, and 11% were unsure. However, organisations that answered were more likely to support this proposal, with 72% agreeing compared to 50% of individuals.

Respondents were also very supportive of the nine proposed actions that local authorities should be required to undertake before being able to introduce a cruise ship levy. All but one of the proposed actions were supported by at least four fifths of those answering, with the top three each supported by at least nine in ten. Please refer to Q9 for details of each action and the corresponding support.

How revenues from a cruise ship levy should be used

Respondents were asked whether revenue raised by a cruise ship levy should be required to be spent on facilities and services (56% of those answering agreed) or whether local authorities should be able to use it in any way they wish (39% of those answering agreed). Views were relatively equally split among individuals who answered, with 46% in favour of focusing on facilities and services compared to 50% who felt a local authority should be able to use the revenue raised as it wishes. Among the organisations that answered, 75% felt the revenue should be spent on cruise facilities and services.

At the open question, individuals reiterated their position that local authorities should be free to use the revenue as needed. These respondents felt local authorities should have the flexibility to invest in community improvements outside of ports and harbours. Many respondents suggested the money could be put towards local infrastructure like roads and recycling facilities or invested in the environment and cultural heritage. In contrast, organisations typically felt the revenue should be ring-fenced and used to improve the facilities for cruise passengers and any related services to enhance their experiences. Some respondents called for the revenue to be spent on ensuring sustainable development in the cruise industry, making the case that this would support cruise tourism through promoting technological innovation and building resilience.

Exemptions

The consultation proposed potential exemptions for five groups: crew members, passengers disembarking at the final port of call, passengers who are paid carers, passengers who are disabled and passengers who are 18 years or under. The highest support was for potentially exempting crew members from any levy, with 68% in favour of this approach and 24% opposed. Views on whether passengers disembarking at the final port of call should be exempt were more mixed, with 46% of those answering in favour of exempting this group, 42% opposed and 12% unsure. Half (50%) opposed exempting passengers who are paid carers, 54% opposed exempting passengers aged 18 or under, and 55% opposed exempting passengers who are disabled. If national exemptions are introduced, nearly half (49%) of those answering agreed that local authorities should be able to create additional exemptions at a local level. Two fifths (38%) disagreed, and 13% were unsure.

Implementation periods and transition arrangements

Two thirds (68%) of those answering supported an implementation period for a cruise ship levy, one fifth (19%) were opposed, and 13% were unsure. When provided with different options for an implementation period, ranging from less than 6 months to more than 18 months, 35% of individuals who answered felt less than six months was appropriate (compared to 6% of organisations), while 61% of organisations felt more than 18 months would be needed (compared to 12% of individuals). While 60% of local authorities felt 12 months was appropriate, more than 18 months was favoured by 92% of cruise industry respondents, 88% of harbours and ports and 54% of tourism-related organisations.

Mixed views were expressed on whether transition arrangements should apply when a cruise ship port call is arranged before a local authority chooses to impose a cruise ship levy, but the port call takes place after the levy has been put in place. Among those answering, 45% felt a levy should be paid in this situation, while 55% felt it should not.

Potential impacts

The consultation asked respondents to consider the impact the levy may have on six distinct groups: local communities, local authorities, Scotland as a whole, ports, businesses linked to the cruise ship industry and cruise ship operators. Overall, 63% anticipated a positive impact on local communities, with 34% anticipating a very positive impact. The same proportion (63%) felt local authorities would be positively impacted (30% very positive impact). On balance, it was also felt that Scotland as a whole would be affected more positively than negatively (51% compared to 33%). Views were more polarised about the potential impact on ports. Just over one third (37%) felt ports could be positively impacted, while 40% felt they could be negatively impacted, including 27% who anticipated a very negative impact. Businesses linked to the cruise ship industry and cruise ship operators were thought to be more negatively impacted by any levy. Two fifths (42%) anticipated related businesses could be negatively impacted (30% very negative impact), while over half (54%) felt that cruise ship operators could experience a negative impact (29% very negative impact).

Title of a cruise ship levy

Among those answering, over half (55%) felt the name ‘cruise ship levy’ is appropriate, 26% did not and 18% were unsure. Several respondents noted that they found it difficult to comment on or provide suggestions for the name when the aims and approach to implementing the levy have not been finalised. Some respondents emphasised the importance of positive framing, using a different name to ‘levy’ or ‘tax’ that would help cruise visitors understand they are contributing to the communities they are visiting.

Point of entry levy

Half (50%) of those answering agreed that local authorities with islands should be given the power to create a ‘point of entry’ levy for one or more islands in their area, 30% did not, and 20% were unsure. Several respondents who preferred a point of entry levy to a cruise ship levy expressed the view that it would be fairer, easier to implement and was supported in earlier engagement. Some respondents who disagreed with a point of entry levy felt it was overly complicated in practice and could add an administrative burden on local authorities.

Conclusions

By exploring the range of possible approaches to introducing a cruise ship levy, the consultation allowed respondents to describe a range of both positive and negative impacts and highlight multiple issues they feel need to be considered if the proposals are progressed. Overall, there was support for creating a cruise ship levy, although individuals were more in favour than organisations. There was also no consensus on many issues; while a preferred approach was sometimes evident at the total sample level, this often masked opposing views between individuals and organisations or between different types of organisations.