Tourists visiting the Shetland Islands will not have to pay a visitor levy on their trips up to the Scottish archipelago after local authorities decided against the idea.
Councils in Scotland are allowed to tax visitors staying in overnight accommodation if they wish to do so after the Visitor Levy Act became law in September 2024.
In January, Edinburgh became the first Scottish destination to vote to add a five per cent surcharge on visitors’ overnight stays by 2026.
However, the Shetland Islands, known for its unique wildlife, breathtaking landscapes and remote island escapes, have decided not to follow suit.
By introducing tourist taxes, local authorities are able to invest funds into tourism facilities and services, which in turn can benefit both local communities and visitors.
The Shetland Islands Council started public consultations and investigations on how a tourist tax may benefit the region, but council leader Emma Macdonald said that a visitor levy “just isn’t the answer, and doesn’t make sense in our context”, reports the Shetland News.
Her deputy, Gary Robinson, said in a meeting on Monday that the visitor levy was something that seemed to be invented to solve visitor economy issues in Edinburgh.
A report to councillors following the investigations said the “risks outweigh the benefits”, with the administrative burden on accommodation providers a significant worry alongside a potential impact on the number of tourists visiting the islands.
The report said that alternative forms of generating revenue, such as cruise levies, are considered to be potentially more favourable.
The Scottish Government recently launched a consultation on a potential separate cruise ship levy in Scotland, but no decision has been made yet.
Cruise ship passengers make up a large number of visitors to the Shetland Islands. The region welcomed over 123,900 passengers across 129 ships in 2023. In comparison, over 88,900 visitors came to the islands via flying or ferry in 2024.
After Edinburgh’s decision to introduce a visitor levy, Glasgow then followed, giving the green light to introduce a tourist tax on accommodation in its city by 2027.
However, other councils have also abandoned plans for a tourist tax, such as South Ayrshire, following residents’ and businesses’ concerns that the area does not warrant one for the number of visitors it receives.
Wales also introduced a law in July to give power to councils to introduce a levy on overnight stays.
While Scotland and Wales have granted their councils the ability to tax tourists, at present, the UK government has no law giving English local authorities the power to impose visitor levies.
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