Title:
Discover the Potential Impact of the Proposed Tourist Tax on Hotel Guests in Cambridge
Content:
Hotel guests in Cambridge might soon be facing a £2 per night tourist tax as local councilors consider implementing a new strategy to boost investment in the prestigious city. This move is not unprecedented in Europe, and a similar initiative in Manchester last year proved to be quite successful.
Significant Investment Forecasted for Greater Cambridge Area
A document outlining the proposed scheme emphasizes the potential for a significant boost in investment within the visitor economy in the Greater Cambridge area. The existing Manchester scheme charges £1 plus VAT per room per night, while the new proposal suggests a charge of £2 per room per night for hotels with 10 or more rooms. By the third year of the scheme, this fee could increase to £3 per night.
Estimated Economic Impact
According to the report, this initiative could generate between £1.5 million and £2.6 million annually over a five-year period, factoring in an average occupancy rate ranging from 66% to 76%. The plan involves creating an Accommodation Business Improvement District (ABID) to manage the charge for overnight stays at hotels.
Implementation Plan for the Tourist Tax
Hotels will be responsible for collecting the levy and passing it on to the ABID on a quarterly basis, with the amount based on the average occupancy rate as per the business plan. Businesses with more than 10 rooms would be identified based on their rateable value threshold for levy collection, encompassing around 35 hotels and properties.
Exclusions and Special Considerations
Some accommodations, such as Airbnb listings and self-catering options, will be exempt from the levy due to their classification outside the business rate database. Secondary businesses that offer accommodation, like pubs with limited rooms, are also anticipated to be excluded.
Potential Agreements with Educational Institutions
Certain educational institutions operating commercial bed and breakfast services may not fall under the mandatory levy requirement due to their status. However, voluntary agreements are being explored to cover commercial room rentals during specific periods.
Supportive Discussions with Hoteliers
Jemma Little, an economic development manager at the Cambridge City Council, highlighted the positive initial discussions with hoteliers regarding the proposed ABID. The decision to establish the ABID will rely on a ballot among hotels within the Greater Cambridge catchment area, scheduled for July.
Moving Forward with the Initiative
Should the proposals be approved, the implementation of the new ABID could commence as early as 2025. Maria Manion, chief executive of Cambridge BID, underscored the simplicity of the proposed model based on the successful Manchester scheme, catering primarily to hotels with 10 or more rooms.
Positive Reception and Future Steps
Labour Councillor Cameron Holloway expressed support for the initiative, noting the positive impact it could have on the city. The committee unanimously agreed to further explore the proposals and proceed towards a ballot of hoteliers to gauge their interest.