Rayner accused of turning ‘blind eye’ on tourist tax

By the Editorial Team · Monday, September 21, 2026

The UK government has decided not to conduct a nationwide economic impact assessment before allowing local authorities to introduce a tourist tax on temporary accommodation, with legislation expected this autumn and implementation unlikely before 2028. This approach has sparked concern among business groups and opposition politicians who warn the levy could harm the hospitality sector, reduce visitor spending, and cause job losses without a comprehensive evaluation of its effects.

Ministers have opted not to commission an official economic impact assessment ahead of plans to introduce a "tourist tax" on temporary accommodation across the UK. Instead, responsibility for assessing the effects of the overnight visitor levy will be delegated to local mayors and regional leaders. The government intends to announce legislation this autumn granting these authorities the power to impose the tax, which is expected to take effect from 2028 at the earliest.

The proposed levy aims to raise funds from visitors, with proceeds intended for reinvestment into local communities, including improvements to high streets, public transport, and tourism-related events. Housing, Communities and Local Government Secretary Angela Rayner has defended the proposal by pointing to similar schemes implemented in other countries. Labour mayors have indicated they will cap the levy at 5 percent, while Conservative and Reform UK mayors have pledged not to introduce the tax in their areas to avoid increasing costs.

Despite these assurances, the plan has faced criticism from business groups concerned about its potential impact on the hospitality sector. Firms in industries such as hotels, restaurants, and bars warn that the levy could lead to a decrease in visitor numbers and result in job losses. Research by Oxford Economics, commissioned by UKHospitality, suggests that a 5 percent tourist tax could reduce consumer and visitor spending by approximately £1.78 billion and put 33,000 jobs at risk.

Business representatives, including Craig Beaumont of the Federation of Small Businesses and Jonny Haseldine of the British Chambers of Commerce, have called on the government to conduct a thorough economic assessment before implementing the tax. Beaumont described the decision to forgo such an analysis as “turning a blind eye” to potential negative consequences, while Haseldine labeled the move as risking damage to tourism destinations at a time when businesses can least afford revenue losses.

Critics have also noted differences between the current approach and recommendations from the 2007 Lyons Review, which advised that any local tourist tax should require demonstrable local support — a stipulation absent from the forthcoming legislation. Nick de Bois, former chairman of Visit Britain and a former Conservative MP, expressed concerns that leaving economic impact assessments to individual regions could lead to duplicated costs and unreliable results.

The Conservative Party has voiced opposition to the visitor levy, with Shadow Chancellor Andrew Griffith accusing ministers of ignoring warnings about harm to the tourism and hospitality sectors. As an alternative measure to boost visitor numbers, the Conservatives support reinstating tax-free shopping for overseas tourists—a policy previously scrapped in 2021 during Rishi Sunak’s tenure as chancellor.

A spokesperson for the Housing, Communities and Local Government Ministry responded to the criticisms by emphasizing the uncertainty of any central government modelling, given that local leaders will determine whether and at what level to impose the levy. They reiterated that all funds raised would be invested locally to support economic growth and benefit both visitors and residents.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.