Family holidays 'at risk' from Welsh tourist tax

A decision to partially exempt under-18s from paying a tourist tax in Wales could still lead to a drop in families holidaying in the country, UKHospitality has warned.

 

There had been concerns that the proposed 75p per person fee on stays in hostels, campsites and outdoor centres could make school trips less affordable for low-income families.

 

Welsh finance secretary Mark Drakeford said this week that the charge would be axed for under-18s, but they would still be taxed for staying in hotels and B&Bs.

 

However, fees for everyone else will also increase by 5p per night. This means that if the bill passes through the Senedd, a charge of £1.30 per night before VAT could be charged on overnight stays in hotels, B&Bs and self-catering accommodation.

 

A lower 80p rate would apply to hostels and campsites for adults.

 

UKHospitality Cymru said the move was a “blinkered” decision that will continue to disincentivise families from holidaying in Wales.

 

It called for the Welsh Government to go one step further and implement a total exemption for under-18s being charged the levy.

 

David Chapman, executive director of UKHospitality Cymru, said: “Families across the UK spend many months saving up their hard-earned money to take their families on a summer holiday, with Wales one of the top choices for those staying in the UK.

 

“Very many of these families will prefer to do so in a hotel, B&B or self-catering, with campsites or hostels simply impractical for many with young children.

 

“It is a blinkered decision to retain the visitor levy’s child tax on hotel stays. The total cost of the levy for a family of four could be the equivalent of a night’s stay in a hotel. That’s either unaffordable for many, or enough to put them off visiting Wales.

 

“I have no doubt that the Welsh Government is trying to do the right thing though this partial exemption, but it’s revenue-driven and ends up creating a two-tier holiday offer in Wales, which punishes families and businesses alike.”

 

Councils in Wales would decide whether to introduce the fee if a new law is passed by the Senedd, with charges possibly starting in 2027.

 

The Welsh government said the tax could raise up to £33m a year.

 

Edinburgh will introduce a 5% tax on overnight stays from 24 July 2026, the first levy of its kind in Scotland.

 

Cities including Manchester have introduced overnight visitor charges to fund local Business Improvement Districts (BIDs).