In England, the 'tourist tax' era

Under the plan, instead of a flat fee, a certain percentage of accommodation costs will be taken from tourists.

Representatives of the tourism and accommodation sectors warn that the implementation will increase the cost of family holidays.

UKHospitality President Allen Simpson argued that an average family holiday could incur an extra cost of between £100 and £120.

The government says that the absence of a fixed fee will limit the effect on tourists' budgets.

Different systems are applied in Manchester and Liverpool.

The tourist tax proposal had previously surfaced during former Prime Minister Keir Starmer's tenure. The issue was also addressed in King Charles III's parliamentary speech in May.

In England, similar rates already exist in Manchester and Liverpool. In Manchester, the nightly rate per room is 1 pound, while in Liverpool a 2‑pound fee is applied.

These systems are implemented as industry‑led initiatives rather than taxes imposed compulsorily by local authorities.

London Mayor Sadiq Khan also supports granting municipalities the authority to impose a tourist tax.

In Scotland, local authorities have the power to levy a lodging tax. In Edinburgh, the rate is 5% and is limited to a maximum of five nights. In Wales, a per‑person nightly cap of 1.30 pounds is planned to take effect in April 2027.

Details on the scope of the new system in England and the rates to be applied are expected to be announced after the government meets with city mayors.