Tourism tax: discussion document

This document has been prepared to support our national discussion on transient visitor (tourist) taxes in Scotland. Comments can be sent to

1. Introduction

Tourism is a key sector of the Scottish economy. It employs 206,000 people in Scotland, and is a significant provider of economic opportunities across Scotland’s cities, towns and rural areas. Scotland has seen significant increases in visitor numbers in recent years, particularly from overseas. The Scottish Government is committed to working with Scotland’s tourism industry and other partners to support our common goal – the continued success of this key sector.

In recent months, a number of our Local Authority partners and the Convention of Scottish Local Authorities (CoSLA) have called for the Scottish Government to grant the powers to allow them to levy a transient visitor tax, or tourist tax, in their areas, should local circumstances be supportive. However, there has been significant opposition to these proposals from among the representatives of Scotland’s tourism industry.

The Scottish Government believes that this issue requires careful consideration, particularly in light of the economic uncertainty created by Brexit. As Tourism is one of Scotland’s key economic sectors, and powers for Local Authorities would require legislation by the Scottish Parliament it is important that these considerations have a national, as well as local, dimension.

In response to these issues, the Scottish Government is taking forward a national discussion around tourist taxes in Scotland. Through this discussion, we are engaging with a range of partners to:

  • Seek views on the need for, and purpose of, a transient visitor tax in Scotland, in the context of current challenges and future opportunities for supporting sustainable and inclusive growth.
  • Encourage debate on available options for addressing underlying challenges and opportunities within Scotland’s tourism sector;
  • Encourage partners and stakeholders to provide and share evidence of potential impacts of tourist taxes on the tourism sector, visitor economy and local government; and
  • Encourage partners and stakeholders to articulate challenges and issues that would need to be addressed were devolution of a transient visitor tax power to the local authority level to be considered or taken forward.

The aim is to bring partners together to ensure a full range of voices are heard in this discussion, and to build a common and shared understanding among our partners of the issues, opportunities and challenges in this area, in the context of supporting the tourism sector’s continued contribution to delivering sustainable and inclusive economic growth in Scotland. The Scottish Government is not seeking to test an existing, specific policy position on a transient visitor tax.

The Role of This Document

To support the national discussion, the Scottish Government has prepared this discussion document. The purpose of this document is not to present a case ‘for’ or ‘against’ a transient visitor tax. Instead, the document aims to provide a range of evidence around the importance of tourism across Scotland; the international experience of tourist taxes; and to highlight core issues that future discussions on this topic should seek to consider and engage with.

The structure of this document is as follows:

  • Section 2 summarises the Scottish Government’s economic approach, and the principles that inform the Scottish Government’s approach to tax policy;
  • Section 3 provides an overview of tourism activity across Scotland, and the importance of tourism to Scotland’s economy;
  • Section 4 gives a brief overview of types of taxes levied on tourism businesses in Scotland, and the use made of occupancy taxes in other countries;
  • Section 5 draws out important facets of the evidence base around tourist taxes, which may be of relevance to the national discussion; and,
  • Section 6 sets out broad themes and questions for the national discussion.


Email: Kevin Brady

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