Official Report 1510KB pdf
Visitor Levy
To ask the Scottish Government whether it will clarify its position regarding whether local authorities will be given powers to introduce a visitor levy on a flat charge basis, as an alternative to a percentage.
The existing legislation enables councils to introduce a levy based on a percentage of the cost of overnight accommodation. There is no barrier to local authorities that wish to proceed on that basis, and there is already flexibility in the system to tailor the charge to local circumstances. Some councils would like the option to apply a different basis of charge, and we have no in-principle objection to having that added layer of flexibility, so we are giving the matter active consideration.
A change of the nature that is suggested would require an amendment to primary legislation and, as such, would be subject to appropriate consultation, parliamentary scrutiny and the identification of an appropriate legislative vehicle, all of which would of course take time to work through.
I thank the minister for his response, but this is an absolute shambles from the Government. On Friday, he wrote to the Economy and Fair Work Committee and said that the Scottish Government was
“now actively extending powers to local authorities, including the option to introduce a single flat rate or tiered flat rate model alongside the existing percentage-based approach.”
That is entirely clear, and it was warmly welcomed by the Scottish Conservatives, who have been campaigning on the issue for many months. Indeed, it was warmly welcomed by industry representatives. Yesterday, however, we had a U-turn on the U-turn. Yesterday afternoon, we found out in another letter from Mr McKee that he had missed out a vital word from his original communication, and that word was “considering”. Can we at last get some clarity on what exactly is going to change and, crucially, when it is going to change—given that local authorities are actively consulting on the visitor levy, when they do not even know what powers they are going to have and when?
As Murdo Fraser knows fine well, there was an error in that letter, and it was not consistent—[[Interruption.] That is the reality of it. It was not consistent with the letter that had been sent—[Interruption.]
Let us hear one another.
It was not consistent with the letter that had been sent to industry and other stakeholders at the same time.
Our position is that we absolutely recognise that there is a request for more flexibility from the sector and, indeed, from some local authorities. We have long recognised that. We are minded to bring forward changes to enable that, but, of course, we need to identify a suitable legislative vehicle. The member will be as well aware as anyone else that the legislative programme in the run-up to March is extremely busy, and finding a slot for making such changes will be very difficult—[Interruption.]
Let us hear the minister.
We have committed to considering taking this matter forward, should we be in government, early in the next parliamentary session.
It is also important to recognise that, although Murdo Fraser and the Conservatives are making a lot of noise about this matter, when the Visitor Levy (Scotland) Bill went through, none of them produced any amendments that would have allowed local authorities that flexibility. They complain about it now, but they did not take that option, and they should reflect on that.
The minister says that there was an error. It took him three days to notice that error and correct it. In the meantime, there was press coverage at the weekend saying that the Scottish Government had changed its mind, and there was no correction from the Government at the time.
Councils across Scotland are actively considering the introduction of a visitor levy. Some have gone quite far down that track, including the City of Edinburgh Council. Others have consulted and are still to take a decision. Others are still consulting through open consultations. No councils can take a final decision on what they will do if they do not know when they are going to be given the powers—if they are going to be given them at all. Does the minister agree that we now need a moratorium on any councils introducing a visitor levy until this shambles is sorted out?
I know that Murdo Fraser and Conservative members are getting very excited about this, but the reality is that, if we talk to the sector or to local authorities—
Talk to business.
That is exactly what we have done, and that is why we are making the change—
Listen to business.
If I might stop you for a second, minister. I have several requests for questions, and I will not be able to take any more if we have constant interruptions. Please continue, minister.
As I have made very clear, the legislation allows authorities such as the City of Edinburgh Council that want to proceed on a percentage basis to continue to do so. It already allows local authorities considerable flexibility to bring forward other proposals. The changes that we are looking to make are to enable a tiered flat-rate system to be brought in, in addition to the existing system.
That is our clear position. We have been clear for quite a period of time that we are interested in listening to the sector; we want to introduce flexibility and to enable local authorities to have that. We will take that forward when a legislative vehicle allows us to do so.
The visitor levy is a local tax, so it is appropriate that local authorities can set a rate that meets the needs of their area and residents. Can the minister confirm that any local authority that wishes to introduce a levy under the existing system would be supported to do so?
That is absolutely the case. The visitor levy is a local tax, and it is right that local authorities are empowered to set a rate that reflects the needs and priorities of their area and its residents. I can confirm that any local authority that wishes to introduce a visitor levy under the existing system will be fully supported to do so.
The Scottish Government, through VisitScotland, has published statutory guidance and is working closely with local authorities to ensure that the tools and support that are required to design and implement a levy work for their communities. We are committed to ensuring that the introduction of any visitor levy is locally driven and transparent and delivers benefits for residents and visitors alike.
I draw members’ attention to my entry in the register of members’ interests.
This is an embarrassing omnishambles by the Scottish National Party. It is once again punishing businesses that have already been punished by its not passing on business rates relief, and now it is delivering a botched visitor levy scheme. My colleague Murdo Fraser is absolutely right. Minister, will you admit that you got it wrong, that this is unworkable and that you will call a moratorium on this ridiculous scheme?
Always speak through the chair, please.
I remind members on the Conservative benches that they did not lodge any amendments to the Visitor Levy (Scotland) Bill, which was passed by this Parliament, that would have offered the flexibility that we are now proposing to offer the industry, which local authorities are calling for. Conservative members need to answer the question why, at that time, they did not think that it was a good idea to make the change that we are now considering making.
On a point of order, Presiding Officer. During the passage of the bill, I lodged amendments 22 and 26 and a package of amendments that would have allowed local authorities to set a flat rate for the visitor levy. I believe that the minister is misinforming the Parliament.
That is a debating point, Mr Briggs.
On the contrary, Presiding Officer. Miles Briggs has been very clear. He lodged amendments that would have changed the basis of charge from a percentage to a flat rate. They would not have allowed a percentage rate or, indeed, a tiered flat rate, which is what the industry is largely calling for now. We are talking about allowing all those options to be available to provide flexibility. My point remains that at no point did any member lodge an amendment that would have allowed the flexibility of all those options being implemented.
The move from the Government to simplify the scheme is welcome. However, the minister has stated that the Government’s position has been clear for a period of time. Unfortunately, that period of time is just a matter of days, and local authorities are proceeding to implement the scheme in the coming weeks. I would like clarification on the following points. Will the legislative change that the minister has set out be in addition to the existing legislation, and, therefore, will current schemes be able to proceed? Will that be a legislative change in the coming parliamentary session—will he clarify that remark? There was also some discussion of a regulatory change through secondary legislation. Has that now been ruled out?
The regulatory change is a separate issue. It is to put in place regulations that will allow the percentage scheme to be taken forward. Those are listed in the response that I sent back to the committee. I am very happy to engage, and for my officials to engage, further with Daniel Johnson to go through the details of that, which is quite a complicated technical area.
Current schemes can absolutely continue—I have been very clear about that. The City of Edinburgh Council, or any other council that is bringing forward a proposed scheme on a percentage basis, is absolutely able to continue to do that to the current timescales. We are proposing to make changes that will broaden out the scope, so that a tiered flat-rate scheme can also be introduced.
With regard to timing, as I have made clear, we are looking for a legislative vehicle that will allow that change. Daniel Johnson will be well aware of the number of bills that are working their way through the Parliament over the coming weeks and months—indeed, we are staying very late tonight to take a bill through stage 3—so finding a slot is the challenge. We would like to do this earlier, but, realistically, I think that it will happen after May next year.
I am afraid that the shambles has created greater uncertainty for local authorities. Perhaps it is no surprise, therefore, that, today, Orkney Islands Council—following the same approach as Shetland Islands Council took last week—voted not to introduce a visitor levy. I understand that Western Isles Council has similarly paused its plans.
In Orkney, the local tourism sector has proposed introducing a point of entry levy. Can the minister update members on when the Government plans to take a view on such proposals?
All that we are doing through the legislation is responding to requests from industry and local authorities to give them more flexibility over the type of visitor levy that they can use. We have indicated that we would seek ways to provide such flexibility, if that is what they want. It is right for the Government to listen to stakeholders and give them more flexibility, and not to prevent them from doing anything that they are already empowered to do.
The member’s other point, about the possibility of a levy that could be charged when someone enters a local authority area, presents different challenges. We are not actively pursuing that idea at the moment, but I am keen to have conversations with members and others who have proposals in that space, so that we can understand more specifically what they are suggesting.
It is extremely important that we protect time for the next item of business, so it would be helpful if members could be concise.
The minister has said that he is considering taking measures to allow the flaw in the bill to be changed, to allow local authorities to choose a flat-rate tax should they so wish. Is it not the case that the minister has already taken steps to try to do that, by lodging an amendment to the Housing (Scotland) Bill to have the measure dealt with in that bill, as I have heard; but that—not surprisingly, to those of us who have studied the bill—that request was declared incompetent by yourself, Presiding Officer? If that is the case, why has that decision not been explained to the Parliament, in the interest of transparency?
Moreover, surely tourism issues are sufficiently important to merit time for amendment by way of primary legislation—and surely such amendment must be done.
I again reflect on the fact that the Parliament passed the legislation as it was—I reiterate that, at that point, no one lodged any amendments to broaden the basis of charge. I have been clear that we are seeking a legislative vehicle to enable the change to be made. The member can make a point about how we do that, and I am open to suggestions about it. However, all members are aware of the challenges presented by the amount of legislation that the Parliament is due to consider in the coming weeks and months. The Government is exploring mechanisms whereby we can deliver change, while listening to what industry and local authorities have asked for and responding by delivering what they want to see.
The minister can dead-bat questions all the day long if he wishes to—he is very capable of doing that. The reality is that Murdo Fraser is right: the situation is a complete shambles. The whole reason for putting an urgent question is that the minister issued two contradictory letters in the space of four days. How on earth does that happen in a Government office—the office of the minister? The minister should take the time to explain to members how such contradictory statements were issued in his name. Who, precisely, proofread those letters? Who signed them off? If it was the minister, I am afraid that the charge of incompetence rests with him.
As I have already explained, unfortunately, there was a typographical error in one of the letters that was sent out. That letter was reissued so as to provide clarification. If Conservative members are still getting so excited about one typographical error—one misplaced word—it is a shame that they have not got more important things to worry about.
I have been very clear with anyone who has engaged with me—[Interruption.]
Let us hear one another.
We should listen to the industry and its perspective on the situation. Industry representatives are comfortable that we are seeking to make the change in question. We listen to them and to local authorities. As I have said, we recognise the importance of having additional flexibility in the legislation that was passed, which is why we are making a change at this time.
Thank you. That concludes the urgent question.
On a point of order, Presiding Officer. I seek your guidance, please. A moment ago, I asked the minister whether, instead of there being attempts in the future to tackle the problem with the legislation, such steps might already have been taken, as has been brought to my attention—namely, attempts to amend the Housing (Scotland) Bill through wording that would have also altered a provision in the visitor levy legislation. Will you share with the Parliament whether such a move was proposed, submitted or made? If so, in your judgment, was that amendment attempt irrelevant?
This is an important matter: if the Government tried to make that amendment, it clearly thinks that it must be done. If it is now saying that it cannot do so because there is not enough time, even though we will still be here for about two thirds of a year, what does that say about the importance of tourism to this Government?
Thank you, Mr Ewing. I do not generally share information with regard to admissibility and selection decisions.
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