England Proposes Tourist Tax For Overnight Stays

Published on November 27, 2025

Soon, England may introduce a tourist tax, which means hotel guests, guests in guest houses and short-term rentals, and any community project supporters traveling in and out of England will have to pay a small surcharge which will go to the support of community projects. For England supporters, the new tax will have a much bigger impact to the tourists and the businesses that support these travelers than to the travelers themselves.

What Does the New Tourist Tax Mean for Visitors?

Under the new plan, English mayors will be granted the power to impose a tax on overnight stays in various types of accommodation, including hotels, bed and breakfasts, guesthouses, and short-term rental properties like those listed on platforms such as Airbnb. The government has stated that certain accommodations, such as homeless shelters, will be exempt from the tax. This move follows a growing global trend where cities and regions with high tourism rates are turning to tourist taxes to fund local infrastructure, services, and other community projects.

The introduction of the tourist tax is part of a wider push by the UK government to provide local authorities with the tools they need to address the challenges posed by increasing visitor numbers. The government believes this new revenue could be crucial in funding the upkeep and development of local infrastructure, improving tourism experiences, and enhancing the areas that visitors frequent.

Global Trends in Tourism Taxation

Tourist taxes are not a new concept; they have been in place for years in many of the world’s top tourist destinations, including cities like Amsterdam, Paris, and Barcelona. These cities have successfully used tourism levies to generate funds for maintaining their cultural heritage, improving public services, and supporting local businesses.

In the UK, there has been a growing discussion about the potential for a similar approach in England. Many local leaders argue that the influx of tourists has placed a strain on public services, and a tourist tax could provide the financial support needed to address these pressures. The introduction of such a tax is expected to be particularly beneficial for popular tourist hotspots, which often experience the most significant strain during peak seasons.

The Role of Local Authorities in the New Tax Scheme

The government’s latest proposal places the power to impose the tax in the hands of local mayors. These local leaders will have the discretion to decide how and when to implement the tax, depending on the specific needs of their regions. This decentralised approach aims to ensure that the revenue generated from the tax will be reinvested directly into the local community, supporting projects that improve the visitor experience and help manage the impact of tourism.

While the exact details of the tax remain under consultation, the UK government has highlighted that it is committed to working closely with local authorities to design a levy that balances the needs of residents, businesses, and tourists. The government has acknowledged that careful consideration must be given to how the tax is structured to ensure it does not discourage tourism, which is a vital sector of the UK economy.

Potential Impact on the UK’s Tourism Sector

The tourism industry in the UK is a significant contributor to the national economy, attracting millions of visitors every year. However, as the number of tourists continues to grow, so does the pressure on local services, infrastructure, and resources. The proposed tourist tax aims to provide a sustainable solution to this challenge, ensuring that tourism remains a positive force for local economies without overwhelming the communities that host visitors.

If the tax is implemented, tourists may see a slight increase in accommodation prices, which could affect travel decisions, particularly for budget-conscious travellers. However, the government argues that the revenue generated will be reinvested into enhancing the tourism experience, improving public amenities, and ensuring that communities can continue to thrive as tourist destinations.

Local businesses, particularly those in high-traffic tourist areas, are expected to benefit from the funds raised through the tax. Revenue could be used to support local infrastructure projects such as better transportation links, more efficient waste management systems, and improvements to public spaces. Additionally, some of the funds could be allocated to initiatives that promote sustainable tourism, helping to mitigate the environmental impact of growing visitor numbers.

What’s Next for the Tourist Tax?

The UK government is still finalizing the details of the consultation, the next stage of the design of the levy, and the government states that local authorities will be the main players to finalize the scope and details of the tax within the given autonomy of the local authorities before the tax is compiled. Centralizing government power reflects the trend of the government allowing local authorities to autonomously make decisions that aid the local population and shift the power from the government to the local authorities.

The introduction of the tax on tourism really is a tourism management advanced step for the country as other countries and cities have advanced with experimentation and now England moves with the introduction of the tourism tax. The consultation on tourism for the UK government is still an advanced step. With England the local authorities will still have the greatest influence on tourism.