Festival tax - 'Time is one thing that is not on our side'

WE all know that death and taxes are supposedly life's only certainties - and that the two are probably equally popular.

So the proposal being presented by business leaders for a voluntary "festival tax" has to be welcomed as an innovative approach to the funding crisis facing the city's festivals.

In putting the idea forward, the Chamber of Commerce and its partners are recognising the vital part the festivals play in propping up the Captital's huge tourist trade, attracting around 1.8 million visitors last year.

The "festival tax" is, of course, an alternative to the city council's own proposal for a two per cent levy on the cost of staying in the city's larger hotels.

It is estimated that this so-called bed tax could raise around 3.2 million a year to help promote the city and maintain its World Heritage Site status.

The Chamber-led consortium is confident that its alternative could be more profitable, and up and running quicker, as soon as next summer.

There are, though, fewer guarantees with a tax that is purely voluntary, and there must be concerns that businesses will simply add the extra cost on to our bills every time we visit a bar or restaurant, or even catch a cab, in August. With VAT set to rise to 20 per cent, we are facing enough of a tax rise already, without adding to the burden.

The council's bed tax idea at least has the virtue of directly targetting visitors to the city and sticks to the principle that the user should pay.

Similar schemes have also been shown to work successfully in other parts of the world, particularly in the United States, where a new home is set to be built for Florida's Salavador Dali museum thanks to significant "bed tax" funds.

What everyone agrees on is that something needs to be done to replace the large amounts of public money which the festivals expect to lose as austerity measures start to bite in the coming months.

There is still clearly a lot of talking ahead before any agreement might be reached on the best way of doing that. But, with advanced planning for next year's festivals already under way, time is one thing that is not on our side.