Proposing a new tax was never going to be popular. The capital’s hoteliers claim they have been singled out for punishment and the move will disadvantage Edinburgh which faces fierce competition from other cities across the UK. However, hoteliers would be wise to reflect on the purpose of the tax.
If it takes the form of a bed tax and money raised helps fund the city’s festivals, hotels would not be greatly harmed. We do not believe those paying £100 or more for a room at festivals time would be put off by such a modest price hike. The alternative levy scheme, where businesses in an area are balloted over paying extra rates and the cash is put towards promoting the city, could also have benefits in terms of attracting more tourists.
Provided the council uses the money to promote the city or support the festivals, and not as an extra council tax to avoid difficult financial decisions, they should press ahead with the simplest, logical, option of the bed tax.