Chamber and committees

Yes, and, as I said earlier, we can get too concerned about that. If a chain hotel is on a percentage system, frankly, the operator will not care what the guy next door is doing. Likewise, the guy next door will not care what the chain hotel is doing, because he will simply be following the process. A visitor who books in will be charged what they get charged, based on the mechanism. I think that we can get too concerned about things not all being the same everywhere.

That is a good point. We have engaged very closely and had an effective dialogue with the ASSC, the Scottish Tourism Alliance and other industry bodies. It was reassuring to hear their perspective on the level of engagement, which is testament to the officials who have worked on the legislation.

To be honest, we are open minded on the per-person, per-night option. It goes back to the convener’s point about striking a balance between flexibility and simplicity, which the evidence sessions, along with our engagement, are helping us to clarify. We have opportunities at stage 2 and stage 3 to lodge amendments.

It was interesting to hear the strength of feeling from the industry about the complexities that the per-person, per-night option could raise. In your evidence session with local authority representatives, I heard one express—this was only one contribution and we can engage with other views—that flexibility on the matter is helpful but not critical, and we are very open minded on that. The one thing that I have asked officials to identify is the range of circumstances, such as accommodations where many people could potentially stay, in which the option would have an impact. We need to understand how large a part of the market that is and how significant its impact would be, so that we can gather more data.

Absolutely. We are very cognisant of that. The 18-month waiting period is still in the legislation, but that is one area where there will absolutely be changes. We did not want to put something in until we had heard the different perspectives on where it should be pitched. Everyone has an interest in the period being shorter. You heard that in evidence and we are absolutely willing to support it.

There are clearly different scenarios depending on what has happened in different places. They include bringing in a levy from scratch, changing to a different basis of charge and changing the percentage rate. The latter will inflation proof the levy to some extent, so it is different from a periodic review of a flat-rate structure.

We are interested in hearing the different perspectives of industry and local authorities on the best place to pitch the waiting period, but you are absolutely right. There will be a much shorter period for some of those scenarios. As you said, some councils are involved in the process and have started to go down one road. It would clearly be in nobody’s interest for us to reset the clock and bring them right back to the beginning. The question is what the period should be and what it should apply to. We are interested in hearing the evidence on that.

Exceptions are different, right? On how that operates, individual exemptions—

Exceptions. Sorry—I am getting ahead of myself here.

It will depend on which schemes are chosen to be implemented locally, which will have a bearing on the costs. It is also worth bearing in mind our earlier discussion about simplifying the scheme. That would lead to the costs for businesses being lower as a consequence of the amendments in the bill than they would otherwise have been had flexibility and simplicity not been available to them.

There has been engagement on the financial memorandum, and I will let officials talk about the level of that engagement.

Thank you for the opportunity to set out the purpose of the Visitor Levy Amendment (Scotland) Bill, how it will deliver enhanced flexibility for local authorities by introducing an additional basis of charge, and how it will support the practical implementation of local schemes through further provision relating to third-party arrangements and returns. I will also outline the purpose of the three sets of regulations that are being considered under the affirmative procedure alongside the bill today.

I am grateful to the committee for its consideration of the bill and the accompanying regulations, and for the constructive engagement with the Convention of Scottish Local Authorities, local authorities and industry throughout the process. I understand that the committee heard from key stakeholders on 27 January. I will reinforce some of the points that were heard as part of that and will highlight the key measures in the bill.

The bill will make additional provision in respect of certain third-party sales arrangements, reflecting the operational issues that have been raised by local authorities and industry. I recognise that progressing the legislation at pace presents challenges, but I am confident that, with appropriate support and proportionate scrutiny, we can work together to ensure that the system works for all local authorities while maintaining clarity for businesses and visitors.

The bill as introduced builds on the existing powers that allow councils to charge a visitor levy, which are set out in the Visitor Levy (Scotland) Act 2024. It is intended to introduce positive changes. Its key measures include introducing new flexibilities, making further provision on chargeable transactions, making adjustments to returns, and introducing regulation-making powers.

I will take each of those in turn. The introduction of new flexibilities will allow local authorities to design and implement a visitor levy model that is right for their local area—for example, a scheme that is based on a fixed amount or a range of different fixed amounts as an alternative to a percentage-based model. Those fixed amounts may be tailored towards accommodation type, size, location or season. The purpose of the legislation is to strengthen the range of options that is available to local authorities, so that they can design a model that works for their areas. We will also look to build on the legislation by providing updated statutory national guidance for local authorities, in order to ensure that the levy is understandable for visitors.

The bill will make further provision for circumstances in which overnight accommodation is first sold to a third party for onward sale, ensuring clarity for local authorities and providers operating such arrangements. That flexibility is important.

The bill will make an adjustment to the returns that are to be made by accommodation providers, so that they relate to the period in which liability for the levy arises.

The regulation-making powers will help to provide a mechanism for future proofing the visitor levy framework by ensuring that further operational regulations can be brought before the Parliament if needed. The suite of three sets of regulations demonstrates how primary and secondary legislation will work together to support implementation. The regulations provide operational detail that is based on the powers in the 2024 act. Although they have not been the subject of a stand-alone consultation, their content reflects feedback that was gathered during wider engagement with COSLA, local authorities and industry throughout the development of the visitor levy framework.

Turning to the three sets of regulations, I remain committed to delivering a framework for a well-managed visitor levy that works in the interests of visitors, local residents, local authorities and industry. These regulations will support that process.

The Visitor Levy (Local Authority Assessment) (Scotland) Regulations 2026 will ensure that the visitor levy is administered fairly, transparently and in a way that supports compliance. They set out the notice that a local authority is to give of its intention to make its own assessment of the visitor levy payable, what will happen once that assessment has been carried out, and the circumstances in which the outcome of an assessment may be altered.

The Visitor Levy (Reviews and Appeals) (Scotland) Regulations 2026 will ensure that the process of a review of local authority assessments and decisions on visitor levies is clear and transparent, as the measures include specifying the manner in which local authorities must conduct such reviews, the process for bringing an appeal before the First-tier Tribunal for Scotland and the actions that local authorities must take following the disposal of an appeal.

The Visitor Levy (Scotland) Act 2024 Amendment Regulations 2026 will extend the exemption. That means that the levy will not be payable or may be reimbursed where a visitor is entitled to certain disability or health-related benefits, allowances or payments, so that it applies to a wider range of payments.

Overall, the measures in the bill and in the regulations are part of our vision for the visitor levy in Scotland, which aims to improve visitor services, without adversely impacting on the local economy or placing a financial burden on local residents, as we look to share the unique experience of our history, culture, landscapes and warm hospitality.

I will continue to listen to the information that is shared by stakeholders and the committee, and I am happy to reflect on any recommendations that are made. My officials and I look forward to answering any questions that you may have on the bill and the regulations.

10:15

The purpose is to attract more investment into Scotland in relation to property.

We do not know, because obviously no transactions are happening at the moment. The Scottish Fiscal Commission has said that it is below the materiality threshold, which is £5 million. However, in effect, we will not know until it is removed and those transactions start taking place.