UK: England’s mayors will have the ability to spend money on transport, infrastructure, and the customer financial system by a brand new levy on in a single day stays.
Any new levy would apply to guests at lodging suppliers together with inns, vacation lets, mattress and breakfasts, and guesthouses.
It might be as much as mayors and different native leaders to introduce a “modest cost if it’s proper for his or her space”.
Steve Reed, secretary of state for housing, communities and native authorities, stated: “Vacationers journey from close to and much to go to England’s sensible cities and areas. We’re giving our mayors powers to harness this and put extra money into native priorities, to allow them to maintain driving progress and investing in these communities for years to come back.”
A session on the brand new measure will run for 12 weeks and shut on 18 February 2026.
The announcement comes forward of right this moment’s Price range.
Business reactions:
Sadiq Khan, mayor of London
“Giving mayors the powers to boost a vacationer levy is nice information for London. The additional funding will immediately help London’s financial system, and assist cement our fame as a world tourism and enterprise vacation spot. It additionally reveals what might be performed when ministers work intently with mayors to devolve extra powers to cities and areas.”
Helen Godwin, mayor of the west of England
“These new powers are an actual vote of confidence in our area taking extra management of our future. Proceeds from an in a single day customer levy, that individuals from throughout the West are used to paying on vacation ourselves, have the potential to help and improve the sector’s companies and employees – together with with higher transport choices.”
Andy Burnham, mayor of Better Manchester
“Better Manchester already has a thriving customer financial system, and a customer levy will assist us maintain good progress over the subsequent decade. The levy will permit us to spend money on the infrastructure these guests want, like maintaining our streets clear and enhancing our public transport system by later operating buses and trams, ensuring each expertise is a constructive and memorable one.”
Joss Croft, CEO, UKinbound
“The announcement that regional mayors might introduce a levy on in a single day stays will trigger critical concern throughout England’s customer financial system. Worldwide guests to the UK already face a stack of prices together with visa or ETA charges, a number of the highest Air Passenger Responsibility charges on the planet, and 20 per cent VAT on hospitality, prices which weaken the UK’s enchantment as a vacation spot to go to.
“We urge the UK authorities to work intently with business to keep away from measures that might make the UK much less aggressive, much less enticing to worldwide guests, and put jobs and regional progress in danger.”
Kay Buxton, chief govt, Marble Arch London BID
“We imagine that the in a single day levy have to be proportionate, and never pose a risk to London’s customer financial system. The funding raised must be reinvested domestically to enhance situations for guests. Enterprise enter to the design and roll-out of a scheme for London can be very important and Marble Arch BID will work with our colleagues in neighbouring Westminster BIDs to signify our 17 resort members, who between them present over 3,300 resort rooms, to affect the spending priorities of the Mayor of London and ensure the levy is invested in initiatives and providers that profit the tourism sector.”
Ben Spier, head of coverage and regulation, Sykes Vacation Cottages
“The introduction of a tourism tax within the UK represents an extra blow for our nation’s hospitality and staycation business which has already been squeezed by tax rises and regulatory adjustments in recent times.
“This levy gained’t simply be felt by households already managing rising family prices, it threatens to discourage individuals from selecting holidays within the UK which might be a critical blow for the numerous communities that rely closely on spending from the in a single day guests who will face this levy.
“The UK’s tourism and hospitality companies are already among the many most closely taxed in Europe, going through all the pieces from steep enterprise charges and company tax to a number of the highest VAT ranges within the sector. Including a brand new tourism levy dangers placing extra stress, and extra admin, on the numerous small companies – from vacation let homeowners to native pubs, retailers and points of interest – who depend on a thriving customer financial system.”
Kate Nicholls, chair, UKHospitality
“This can be a surprising U-turn that may solely make life costlier for working individuals. It might value the general public as much as £518 million in extra tax once they journey within the UK and having knock-on impacts for the broader hospitality sector. Make no mistake – this value can be handed immediately onto shoppers, drive inflation and undermine the federal government’s intention to scale back the price of residing.”
Highlights:
England’s mayors are being given new powers to introduce an in a single day lodging levy to help transport, infrastructure, and the customer financial system.
The levy might apply to inns, serviced flats, vacation lets, B&Bs, and guesthouses, with every area deciding if and the way to implement it.
A 12-week session runs till 18 February 2026, with the announcement made forward of the UK Price range.
Mayors in London, Manchester, and the West of England have welcomed the measure as a strategy to reinvest in tourism and native providers.
Business teams warn the levy might improve journey prices, scale back UK competitiveness, and put stress on hospitality companies already going through excessive taxation.
