The government's new Overnight Visitor Levy could reduce the amount visitors spend on Britain's high streets, even as it welcomes the principle of giving local leaders more control over investment decisions, a leading independent retailers association has said.
The British Independent Retailers Association (Bira), which works with over 6,000 independent retailers across the UK, said there is genuine concern within the hospitality sector about the impact of the levy, which will allow mayors and local leaders to charge visitors for overnight stays.
Bira's worry is that any additional cost to visitors will inevitably reduce their spending power once they arrive, hitting the independent shops, cafes and hospitality businesses that serve them on the high street.
It was announced this week that mayors and local leaders will be handed new powers to introduce an Overnight Visitor Levy as part of the government's wider devolution drive. The levy will be charged as a percentage of the cost of accommodation rather than as a flat fee, with hotels and other accommodation providers responsible for collecting it.
Mayors and Foundation Strategic Authority leaders are expected to set out spending plans by early 2028.
Bira is calling for strong assurances that revenue raised from the levy will be reinvested back into the high street.
Having reviewed two Mayoral strategic plans published so far, the association noted that high streets are barely mentioned, and said it wants confirmation that money raised in a given area will be spent in that area, supporting the businesses that serve the visitors generating the revenue.
Andrew Goodacre, CEO of Bira, said: "We understand why local leaders want the power to raise funds from visitors, and in principle we support giving mayors more control over how their areas invest in tourism.
"But every extra pound a visitor pays in levy is a pound they don't spend in the independent shops and cafes on the high street. If this money isn't visibly and directly reinvested into the high streets that serve visitors, we risk taking money out of local economies rather than putting it back in."
Goodacre added: "We've looked at two Mayoral strategic plans already, and high streets barely get a mention. Before this levy goes any further, we need cast-iron assurances that the money raised in a town or city will actually be spent supporting the businesses in that same town or city."