Exclusive:'Very high risk' 7% tourist tax sparks Balmoral owner Rocco Forte to hit back at Edinburgh council leader

A leading hotelier has renewed his attack on Edinburgh’s proposed tourist tax, warning the move could not be compared to other major European cities that impose a flat rate fee. 

Sir Rocco Forte, the chairman of the eponymous hotel group, hit out at the capital’s planned visitor levy at the weekend, writing an opinion piece for The Scotsman’s sister title, Scotland on Sunday, in which he dismissed the initiative as “bad for jobs” and “bad for economic growth”.

He described it as a “very high risk” strategy at a time when Scotland’s tourism sector was still recovering from the impact of the pandemic, and predicted that prospective visitors to Edinburgh would either favour trips to destinations in England, or reduce the duration of their stay in the city, while also spending less. 

In response, Cammy Day, the leader of the City of Edinburgh Council, said: “Tourists have come to expect a small fee to visit the world’s top cities, so why not Edinburgh? It works perfectly well in many other European destinations - most places offering a Rocco Forte hotel, such as Rome, Berlin, and Brussels.” 

Now, Sir Rocco, who has also been critical of how the legislation paving the way for the levy was passed by Holyrood, has questioned Cllr Day’s stance, claiming his remarks “fundamentally misrepresents Edinburgh’s plans”. 

He said: “In most European cities that levy a tourist tax, this constitutes a small flat rate fee of a few euros added to the bill. In Italy, this generally varies from €1 to €5 per day per person. Rome's city tax rate is the highest, varying from €4 to €10 per night, according to the rating of your accommodation. In Brussels the tax is €4.

“Charging a percentage of the room rate is a totally different proposition. In Edinburgh, Mr Day’s proposed 7 per cent levy will add as much as £170 to the cost of a castle view suite at my Edinburgh hotel, The Balmoral.”

The 79 year-old added: “The one place we operate where this approach has been tried is Berlin, where a tourist tax of 5 per cent is now added. Crucially, business travellers are exempt, unlike in Edinburgh, but there is still clear evidence of a negative impact. In fact, Berlin is having its worst period for tourism for many years and visitor numbers are well down compared to our other European destinations.”

Responding to Sir Rocco’s latest comments, Cllr Day said: “The Visitor Levy Bill passed by the Scottish Parliament in May was clear that a percentage rate should be charged.

“From our own engagement, we’ve found that there is strong support for a visitor levy amongst both residents and tourists – and that a percentage rate is the preferred option on the basis that it’s a fairer and more proportionate approach based on the ability to pay. This means that a visitor to a city centre five-star luxury hotel, such as Sir Rocco’s, pays more per night than someone staying in a less central small B&B or guesthouse during off-season.

“We’ve not seen any evidence from other destinations that suggests that this will have any effect on visitor numbers, but I’d be happy to meet Sir Rocco to hear his concerns.”