THE proposed Transient Visitor Levy could reboot Edinburgh as driver of industry, says John Donnelly
There’s no escaping that for Edinburgh to sustain and grow its reputation as a world leading destination, a new funding structure is now critical and the status quo is untenable.
Ongoing public spending cuts have seen the marketing budget for Scotland’s Capital city reduced by 30 per cent over the past four years. While our budgets shrink, our competitors are investing millions of euros extra in destination promotion. We’re in immediate danger of falling far behind.
The need for increased level of sustained investment is widely recognised and agreed in the industry. The Scottish Tourism Alliance recently stated that to enable quality marketing of Scotland’s destinations and to help raise the quality and overall destination appeal, more funds are required. When it comes to Edinburgh, I couldn’t agree more.
Scotland’s capital makes a major and disproportionately large contribution towards the Scottish Government’s economic strategy, the Cities Strategy, and the National Tourism Strategy. According to the Scottish Government, Edinburgh also delivers 26 per cent of the total £4.7bn contribution that tourism brings to the Scottish economy (£1.42bn).
VisitScotland reports more than 60 per cent of all overseas visitors will stay in Edinburgh during their time in Scotland. Figures published by VisitBritain show that in 2014 Edinburgh attracted 1.62m overseas visitors. That’s around 2.5 times more overseas visitors than the next most popular city destination, Glasgow, even with the boost of the Commonwealth Games that year.
Edinburgh is the gateway to Scotland. If the city fails to maintain its competitiveness and promote itself effectively, Scotland as a whole will suffer.
Where future investment comes from is the biggest challenge facing the tourism sector today. It’s been suggested that it should fall with industries, agencies and local authorities to foot the bill. However, with ongoing substantial public funding cuts, limited private sector support and increased competition from other city destinations, this is a restricted solution, and in fact unrealistic.
Marketing Edinburgh believes the next stage is a consultation with tourism businesses and organisations. We need a clear, balanced and thoughtful debate, considering the merits and disadvantages of every option. Reaching an agreement on the best route forward, with everything on the table.
Potential options such as a Transient Visitor Levy, or possible tax raising powers under discussion with the ongoing City Region Deal negotiations, shouldn’t be instantly dismissed before a full deliberation.
Like many in the tourism sector, I have reservations that any blanket tourism levy would be fair and workable. Yet as the Scottish Government looks to devolve powers, it stands to reason that this should be reflected in local councils. This isn’t just about tourism, but improving infrastructure, connectivity and encouraging the public and private sector to better engage with shaping the future of the city they live and work in.
Edinburgh is home of the world’s biggest arts festival and the Hogmanay celebrations. Would a small peak season levy of say, £2-£3 or 1-2 per cent, a charge visitors willingly accept and pay in the majority of other European city destinations, really dissuade them from coming?
It’s been almost a decade since any robust survey fully examined tourism levy. Now is the time to reprise a new survey for today’s visitors.
Despite the time-lapse, Scottish Enterprise’s survey into Tourism Levies and Visitor Taxes is still compelling. Back in 2006, findings indicated visitor numbers to Edinburgh may not be severely affected by the introduction of a tourism levy. 70 percent of those surveyed agreed that “I think visitors to a City should help contribute to the area”. And 80 per cent also agreed: “I would not mind a small visitor tax if it was clear what the money was used for”.
I believe any promotional revenue generated must be reinvested directly into enhancing visitor experience and bringing tourists into the city – and in turn, Scotland. VisitScotland has likewise indicated it is not averse to a levy, if monies raised go back into city promotion.
With an appropriate level of funding in place, Edinburgh would at last be in the position to afford global destination marketing campaigns, protect and build on our cultural and heritage offering, support existing festivals, and create new events to entice visitors into the city during the quieter shoulder months.
Only by working together will we shape the successful and properly-funded future Scotland’s tourism offering rightly deserves.
• John Donnelly is chief executive of Marketing Edinburgh