Our role is to create opportunities for positive policy change to build a vibrant tourism economy in Scotland and create the best possible conditions for your business to grow and be more profitable. Your voice in tourism matters; it is your voice that helps to shape the future of our industry.
We continue to campaign on the issues that affect the growth and sustainability of our tourism industry such as tourism VAT, infrastructure, digital and skills. Please share your thoughts and experiences with us as this gives us a stronger voice to influence future policy in a range of areas.
5 July 2018
The Member Council of the Scottish Tourism Alliance (STA) welcomes the reaffirmed Scottish Government position that it will not legislate to grant powers to local authorities to introduce a Transient Visitor Tax without the full involvement of the tourism industry and ensuring that the long term interests of the industry are fully recognised.
The STA Member Council is of the view that any change to this position should only be considered in the light of an objective and well-informed national, rather than local debate, following conduct of independent research, undertaken by a suitably experienced firm or, perhaps, SPICE (Scottish Parliament Information Centre) and formal stakeholder consultation initiated by the Scottish Government.
The STA has communicated a request last week to the Scottish Government for a meeting for initial discussions around the preparation of the research brief and shaping of a proposed framework for consultation.
While a tourism tax/visitor levy may work well for tourism businesses, destinations and local authorities in other global destinations where the level of VAT on tourism services is lower than that of the UK, the idea must be examined within the context of: the UK having the second highest VAT rate in Europe at 20%; the challenges which exist to the imposition of an additional tax; the impact on price-sensitive visitors and indeed the impact on businesses already coping with the ‘perfect storm’ of rising costs that tourism businesses in Scotland currently face. We would also highlight that whilst the exchange rates are currently favorable for our international markets this may not persist beyond the short-term and the fact remains that around 60% of Scotland’s tourism spend comes from our already squeezed domestic visitors. Any further tax or levy applied could seriously dilute this market.
The UK is second from bottom in the World Economic Forum ranking, 135/136, when measured solely on international tourism price-competitiveness; this is in stark contrast to its overall ranking of 5th in the world when the full range of international tourism indicators are included. This underlines that the introduction of a tourism tax or any such visitor levy would further reduce the competitiveness of our already heavily taxed sector relative to competitor destinations. Any new tax on tourists or the businesses serving them could ultimately have a potentially devastating long-term impact on Scotland’s tourism industry and local economies which could lead to potential job losses.
It would also in our opinion negatively impact businesses, beyond the accommodation sector that would be expected to collect any tourist tax, that rely on the tourism economy by reducing visitor spending right across the industry; in pubs, restaurants, shops, cafes, visitor attractions and entertainment venues.
It should also not be ignored that tourism businesses already contribute significantly towards enabling public sector spending through high levels of business rates with many also contributing to local BIDs to which invest in the destination. Over and above this many tourism businesses also provide direct funding support as members of their local destination marketing bodies on top of investing in their own business marketing and promotional activity which, of course, benefits the destination overall.
The need for Scotland to remain, and indeed become more competitive as a destination for visitors to travel to and spend money in is now greater than ever in relation to our impending exit from the EU. Applying any additional taxation or levy to visitors in the current economic conditions and tax regimes that are currently in force is not the answer.
Only if there is clear evidence that there would be no negative impacts on the Scottish tourism economy, and its component businesses, including, tourism employment and importantly, the accommodation sector might the STA Member Council then be open to reconsidering its current position.
The following STA Council Members and other organisations have signed up to this statement to date:
In the news
Scottish Tourism Alliance response
16 May 2018
"The Scottish Tourism Alliance (STA) has requested an urgent meeting with the Tourism Minister, Fiona Hyslop MSP to discuss the mounting concerns within Scotland’s tourism industry around the current issues around planning, procurement and reliability of our ferries service and have been assured that there is a commitment from the Scottish Government for that meeting to take place as soon as possible.
The STA had a meeting with Transport Scotland on 20th April and took with them two of their Council representatives, the chair of the Scottish Destination Management Association (SDMA), Robert Kidd and Director of Outer Hebrides Tourism (OHT) Rob McKinnon. The purpose of the meeting was to make the senior Transport Scotland ferries directorate fully aware of the current impact that the ongoing ferries issue is having on the islands’ tourism economy.
Further dialogue is being planned and the organisation continues to have ongoing conversations with CalMac. Data and evidence is also currently being gathered from STA industry stakeholders through associations such as Outer Hebrides Tourism (OHT) and the Argyll & Isles Tourism Co-Operative (AITC). We look to sharing this with Transport Scotland officials and at forthcoming meetings with the Cabinet Secretary. We very much hope that this meeting will happen within the next two to three weeks."
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All non-domestic properties need to pay business rates, similar to individuals paying council tax. The revenue raised is used as part of the funding for local services.
Our campaign around the Business Rates revaluation cemented our position as the lead voice of industry and enhanced the relationship we have with Scottish Government and politicians across all parties.
We wrote to the First Minister and other Ministers demanding a need for a review of the business rates revaluation and have had regular dialogue with Scottish Government to convey our views, concerns and evidence from businesses on the devastating impact of the proposed Commercial Rateable Values on Scotland’s tourism industry.
We were hugely boosted and encouraged by the Finance Minister’s announcement of a 12.5% business rates cap for hospitality and licensed trade businesses of one year, a pragmatic move which will allow the Barclay Review group to report on its findings, and for a more equitable process for rates evaluation to be agreed and applied.
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Barclay Implementation: A consultation on non-domestic rates reform - Closes 17 Sep 2018
The purpose of this consultation paper is to inform the Scottish Government's implementation of the accepted Barclay recommendations which require primary legislation.
This paper seeks the views of stakeholders on the implementation of the accepted recommendations of the Barclay Review.
APD was introduced as a tax to pay for the environmental costs of air travel. There are two travel bands; 1) Short-haul flights 2) long-haul flights. APD is levied against every adult passenger departing from the UK (excluding Northern Ireland and the Scottish Highlands).
Air Passenger Duty is known in Scotland as Air Departure Tax. The name was changed to Air Departure Tax as it better reflects the general scope of the tax, which is charged on passengers departing by air from Scottish airports, and also ensures that there is no confusion with Air Passenger Duty, which will continue to operate in the rest of the UK after 1 April 2018.
Powers to replace UK APD were devolved to the Scottish Parliament under the Scotland Bill.
The environmental impacts of reducing the tax are being carefully considered through a Strategic Environmental Assessment.
We would urge the Scottish Government to implement its promised 50% cut in ADT at the earliest opportunity.
The longer this regressive tax is in place, the longer it will damage Scotland’s economy, our tourism potential and ability to prosper as a nation, a fact that has also been recognised by our business and tourism partners.
The reduction and eventual abolition of ADT will play a major role in strengthening Scotland’s connectivity, boosting the economy by an additional £1 billion, delivering 4,000 jobs, growing tourism and creating prosperity for Scotland.
In the news
The future and sustainability of our tourism sector is dependent on the flow of a skilled, talented, professional workforce coming into our businesses and we ask that the Scottish Government increases investment into developing Scotland’s young people to grow our tourism industry for the future and retain its position as Scotland’s biggest economic driver.
This can only happen with support from the Scottish Government to position tourism as a growth industry, one of job creation and opportunity, and the demonstration of government commitment to driving skills development within the sector through the right balance of taxation and investment.
The tourism sector has an enormous skills and resource gap with the industry experiencing huge uncertainty over retention and future attraction of our migrant workforce, a vital part of our industry. Investment in home-grown talent is essential and up-weighting of the funding available for skills development in areas such as leadership, digital and vocational skilling is a requirement to support the positioning and promotion of tourism as a sector of opportunity. Tourism businesses value their teams and a reduction in the overall cost of doing business would enable businesses within the sector to invest in skills development and training, become more competitive in price and deliver the visitor expectations of a quality, memorable experience.
Our ask to Government: For accelerated investment to ensure that Scotland has the network infrastructure (digital, transport, connectivity) required to attract and promote Scotland as a destination and a great place to invest, to increase our economic productivity and enable the tourism industry to be as competitive as it should be.
- Funding for our national marketing agency to be allocated with the weight that will allow VisitScotland to not only continue its efforts in marketing Scotland as a destination globally, but to allow the organisation to have greater reach in its marketing activities at destination level.
- Improved level of consultation with tourism industry in relation to key planning and infrastructure projects
Policy Agenda for the 2016-2020 Scottish Government - download here