Bid to delay Edinburgh's tourist tax rejected amid legal challenge fears
Calls to delay the launch of part of the city’s visitor levy have been rejected, raising fears of a possible legal challenge.
National hospitality groups had asked for the start of advance collection of the levy for future bookings – set to begin in October for the scheme’s July 2026 launch – to be pushed back.
They said that the guidance available to them from the council and the Scottish Government were not clear enough for them to feel comfortable collecting the charge.
But at a council finance meeting on Thursday, council officers insisted the business sector had been provided with adequate guidance, and said they already had significant time to prepare.
Conservative councillors had put forward a position that would have delayed the launch, having first raised it at a full council meeting last month.
Some more recent concerns have been raised about the possibility of the Scottish Government introducing new guidance for visitor levies in the country.
Finance convener and Labour councillor Mandy Watt said the visitor levy had broad popular support among the Edinburgh public, and that the council’s legal team had thoroughly reviewed officers’ recommendation to not delay the start of levy collections.
Replying to questions by Conservative councillor Iain Whyte, a council officer said: “Businesses have had nine months to change their business practices.
“It has been very clearly communicated as of the 24th of January, earlier this year, what the implementation period is going to be.
“We’re not clear whether there will be a Scottish Government regulation issued or when that will come into force.
“We do believe that holding off on the off chance it might would be unwise, both for us and businesses, and put more businesses in more uncertainty.”
She also said that the council’s enforcement of the visitor levy would be ‘reasonable’, and that it had the power to waive penalties where businesses showed that they tried to comply with the rules in good faith.
The council’s chief executive, Paul Lawrence, said if the Scottish Government made any changes to the rules around visitor levies, it would be brought to councillors to discuss what ways the city’s levy would have to change.
Green councillor Alex Staniforth asked: “It was mentioned that most of the lobbying is coming from national organisations, not Edinburgh-based organisations.
“I think I’m okay saying it publicly that elsewhere in the country, some businesses are now saying they would have rather had a flat rate.
“But we already consulted on percentages, and businesses in Edinburgh seem fine with that.
“So would you say that ultimately, businesses in Edinburgh have somewhat different priorities from national businesses, and that we should really be focused on that rather than national lobbying?”
Mr Lawrence replied: “There has been a lot of national discussion about this, and clearly the accommodation base in different parts of the country is different.
“Cosla’s position as the visitor levy legislation was going through parliament was that local authorities should have the flexibility to come forward with a charging regime that reflected the economy in their areas.
“All we have done at all times is to follow the legislative process and bring forward a scheme and consult in that way based on the existing legislation.”
Finance and Resources Committee convener and Labour councillor Mandy Watt said: “Our legal team has gone through this with a fine-tooth comb.
“Our officers have really scrutinised this, have tried to give us and businesses the right advice, and I’m very grateful to them for all those efforts.
“I think delaying it would simply cause further confusion, cause people to think if there will be another delay, if there are some other changes.
“I really think this is the closest that we will get to certainty for businesses. I think the best thing to do is go ahead as planned.”
Cllr Whyte raised concerns about possible legal action that could result from the launch not being delayed.
He said: “What we have to be most fearful of here is that some of those businesses, and some of those business organisations, may launch legal action against the council.
“This council’s track record on judicial reviews is not good. I remind members of that, and every time we get that wrong, it’s very costly for the council and therefore the taxpayer.”