Visitor Levy online reporting platform information: FOI release

Information requested

Given the statistically inadequate sample engaged from the islands’ population, the impact of changes in the economic environment between 2019 and 2023, and the likelihood that Local Authorities would believe that, in making their local decisions, the impact analysis from the Scottish Government would be robust, please provide the rationale and evidence for the document’s recommendation of “A full Islands Community Impact Assessment is NOT required”.

Given the statistically inadequate sample engaged from the islands’ population, the impact of changes in the economic environment between 2019 and 2023, and the likelihood that Local Authorities would believe that, in making their local decisions, the impact analysis from the Scottish Government would be robust, please provide the rationale and evidence for the document’s author’s statement that “Yes – we have consulted and engaged with island authorities and communities to ensure island circumstances have been factored in”.

Given the statistically inadequate sample engaged from the islands’ population, the impact of changes in the economic environment between 2019 and 2023, and the likelihood that Local Authorities would believe that, in making their local decisions, the impact analysis from the Scottish Government would be robust, please provide the rationale and evidence for the document’s author’s response of “Yes” to the question “Is your consultation robust and meaningful and sufficient to comply with the Section 7 duty?”

Response

In your request, you have not asked for any specific data or documents. In the terms of your request, you have asked for the rationale and evidence for responses to questions regarding duties to Island impact. Generally, ‘rationale' can range from abstract to focused, and as a result, the considerations are at times very broad.

I have sought to provide this information where possible, however some of the information is already available. Under section 25(1) of FOISA, we do not have to give you information which is already reasonably accessible to you. If, however, you do not have internet access to obtain this information from the website(s) listed, then please contact me again and I will send you a paper copy.

Section 25(1) of FOISA exempts the information you have requested as it is publicly available, while ensuring appropriate signposting to the information. However, noting that nature of ‘rationale’ under the terms of your request, I think it is appropriate to supplement the links provided with further explanation to assist you fully.

With regard to your request for the rationale and evidence in relation to - “we have consulted and engaged with island authorities and communities to ensure island circumstances have been factored in” – the Scottish Government ran a public consultation from 9 September to 2 December 2019. The public consultation was open to all including anyone within island communities. This is the evidence and rationale for the statement that island communities have been consulted.

The public consultation paper can be found at the following link, The Principles of a Local Discretionary Transient Visitor Levy or Tourist Tax - gov.scot. An analysis of the responses can be found at the following link, The Principles of a Local Discretionary Transient Visitor Levy or Tourist Tax: Analysis of responses to the public consultation exercise. I would note that there were a number of specific references to the needs of islands in the analysis of the responses to the consultation which informed the approach. This advised the delivery of the Visitor Levy, which is a discretionary power for local authorities to use.

You may be interested in the ‘call for views’ during the passage of the Visitor Levy Bill. You can find this, and other details of the parliamentary process of the passage at the following link - Visitor Levy (Scotland) Bill | Scottish Parliament Website.

With regard to your request for the rationale and evidence for the statement, “a full Islands Community Impact Assessment is NOT required”, the impact assessment published alongside the Bill, provides this information:

“In preparing the ICIA, I have formed an opinion that our policy, strategy or service is NOT likely to have an effect on an island community which is significantly different from its effect on other communities (including other island communities). The Visitor Levy is a discretionary power for local authorities to use if they so wish. In doing so, a local authority will have to comply with its duties under the Islands (Scotland) Act 2018. Proposed national guidance, developed in partnership with local government and the tourism industry, will also assist local authorities in considering the needs of island communities in the design of a Visitor Levy scheme.”

For this reason, it was decided that the Bill would not be likely to have an effect on an island community which is significantly different from its effect on other communities (including other island communities), which is a reason for not carrying out a full islands communities impact assessment. The assessment can be found at the following link, Visitor Levy (Scotland) Bill: Island Communities Impact Assessment (ICIA).

With regard to your request for the rationale and evidence for the statement, “the consultation is robust and meaningful and sufficient to comply with the Section 7 duty”, the impact assessment published alongside the Bill, provides this information:

“The Bill will create a statutory requirement for a local authority to consult with local communities and businesses prior to the introduction of a VL. A local authority will also be required to give significant notice and publish its plan on how it planned to use any funds raised through the levy. Additionally, in choosing to enact a Visitor Levy scheme in their area, a local authority will be subject to existing statutory requirements to consult and have regard to communities when preparing a policy. In considering the use of these new powers, under the Islands (Scotland) Act 2018, a local authority will have to comply with its duty to have regard to island communities (section 7) and where relevant undertake an island communities impact assessment should a proposed levy be identified as having a significantly different effect on an island community compared with other communities (section 8).”

The ICIA document also sets out that:

“Our islands face particular challenges around distance, geography, connectivity and demography, so it is important that policy makers consider these properly. It is also important that you make sure islands receive fair and equitable treatment and that your policy, strategy or service outcomes are tailored to their unique circumstances”…..and, “a Relevant Authority must prepare an ICIA in relation to a policy, strategy, or service, which, in the authority's opinion, is likely to have an effect on an island community which is significantly different from its effect on other communities (including other island communities) in the area in which the authority exercises its functions.”

The assessment can be found at the following link, Visitor Levy (Scotland) Bill: Island Communities Impact Assessment (ICIA).

Further to the explanation in the ICIA, the basis of the charge being a percentage, it would not be expected to have a significantly different effect on islands firms than firms of a comparable size in other areas of Scotland that are reliant on tourism. Nevertheless, the ICIA does include observations and concerns around issues including the prevalence of smaller hospitality businesses on islands, the high numbers of day visitors, the existing costs of transport to islands, and that islands and island residents have a particular reliance on using overnight accommodation when people travel to and from the mainland because of the need to build in consideration for potential ferry disruption.

You may find the Business and Regulatory Impact Assessment published alongside the Visitor Levy - Supporting documents - Visitor Levy Bill: business and regulatory impact assessment - gov.scot.

I would add that, local authorities have an obligation to comply with their duties under the Islands (Scotland) Act 2018. Additionally, local authorities have the power to charge different rates and exemptions for different geographical areas. Each local authority has a responsibility to publish an assessment of the impacts of introducing a Visitor Levy, including for the different rates and exemptions they may choose to apply. Local authorities also have a statutory requirement to consult with local communities, businesses, and the public, prior to the introduction of a Visitor Levy. You may wish respond to any consultation in your local area in relation to how they might introduce a scheme.

The ICIA refers to “proposed national guidance… to assist local authorities in considering the needs of island communities in the design of a Visitor Levy scheme”. The Local Authority Guidance on the implementation of the Visitor Levy produced by VisitScotland and its expert group, includes a chapter on Islands (chapter 18) - guidance-on-the-visitor-levy-for-local-authorities.pdf.

As part of the work to consider island communities, it is recommended in the VisitScotland guidance that local authorities consider the following issues when implementing or modifying a Visitor Levy scheme to mitigate any further potential different impacts:

Administration: the makeup of the accommodation provider industry across many island communities differs significantly from that found in other parts of Scotland. For example, island communities often contain a regulations on the administration of a visitor levy in a community which contains islands, it is recommended that local authorities consider the challenges faced by small accommodation providers.

Enforcement: the tendency for island communities to contain a higher proportion of small accommodation providers may require further consideration by local authorities in terms of enforcement procedures. It is recommended that local authorities with island communities consider the potentially higher cost of enforcement procedures. This is as a result of smaller returns through penalties, compared to enforcement conducted against large accommodation providers such as hotels or hotel chains.

Forecasting: due to the potential for higher administrative costs and smaller returns through penalties as noted above, it is recommended that local authorities with island communities actively consider the impact on forecasting conducted prior to implementation or modification of a Visitor Levy scheme.

Reporting: the Act requires local authorities to prepare a report on the amount of revenue collected, the use of net proceeds, and the performance of a scheme in relation to its objectives. It is recommended that, when preparing a report, and where both practical, and the relevant data is available, local authorities consider the inclusion of information relating to the impact of a Visitor Levy scheme on island communities.

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