Scrutiny of legislation has highlighted concerns over whether a new visitor levy will actually raise additional money for the tourism sector and a lack of exemptions on who will be required to pay. The Senedd will debate the general principles of the Visitor Accommodation (Register and Levy) Etc. (Wales) Bill tomorrow (Tuesday 1 April). Here, we review some of the main concerns raised during the Finance Committee’s scrutiny of the Bill. What would the Bill do?
The Welsh Government introduced the Bill to the Senedd’s legislative process in November 2024. The Bill would give local authorities in Wales the power to introduce a visitor levy in their areas. The levy would be a per person per night charge, applying to all people who pay to stay in overnight accommodation. It will be capped at 31 days with certain overnight stays being excluded, not payable or subject to a refund. It would be collected and managed by the Welsh Revenue Authority (WRA).
The Bill also establishes a register of visitor accommodation providers operating in Wales. Providers are required to register, regardless of whether the local authority area they are operating in has implemented the levy, with the Bill allowing the Welsh Ministers powers to publish information from the register.
Our Bill Summary, gives further information on the provisions of the Bill and timescales for its scrutiny.
The Senedd’s scrutiny
The Finance Committee published its Stage 1 report on the Bill in March 2025. The majority of Committee members agreed with the general principles of the Bill except Sam Rowlands MS.
The Committee made 17 recommendations to the Welsh Government. This article discusses some of the key areas identified in the Committee’s report ahead of the Senedd’s debate on whether the Bill should proceed to the next stage.
The Legislation, Justice and Constitution Committee has also scrutinised and reported on the Bill.
Additionality of levy revenue
One of the Committee’s key findings was whether the revenue collected by the levy would create additionality (extra money) for the tourist sector instead of replacing funding already allocated to the sector by local authorities. The report cited the Professional Association of Self-Caterers UK (PASC UK) who said:
Although the funds are intended for destination management and improvement, we believe they will likely replace existing spending in these areas, freeing up resources to be used for unrelated purposes.
To mitigate this concern, the Committee recommended that the Welsh Government should bring forward amendments at Stage 2 requiring principal councils wishing to introduce the levy to establish a Visitor Forum, similar to the approach taken for the Scottish visitor levy.
This would enable stakeholders to engage in decisions around the use of proceeds of the levy, which would support the additionality of the levy.
Adding a premium to the levy
The legislation allows a principal council to apply a premium to the levy rate. Stakeholders giving evidence to the Committee were concerned about the level of information available relating to this premium, while the Welsh Local Government Association (WLGA) suggested that the application of a premium may be appropriate in certain circumstances such as during ‘major events’.
The Committee recommended that the Welsh Government should, in advance of the Stage 1 debate, provide more details relating to the introduction of a premium.
The Committee also focused on the flexibility of applying a premium by recommending that the Welsh Government should commit to considering alternative approaches to the charging of premiums in the context of the visitor levy, as part of any future assessment of the legislation.
Exemptions to the levy
Another key area highlighted in the Committee’s report is the absence of exemptions for under-16s, educational trips and bodies with charitable status.
Evidence submitted to the Committee highlighted that the majority of European visitor levies exempt children and young people with witnesses commenting on the lack of a sympathetic approach to applying a levy to small children.
However, the Cabinet Secretary for Finance and Welsh Language referenced the potential impact on the overall amount raised by the levy, saying:
I think that our figures show that if you took all of those under 16, of compulsory school age and below, out of the levy, the £33.3 million that our modelling suggests that you would collect goes down to £21.3 million.
The Committee also heard that learners engaging in organised residential school trips in support of their education are not ‘tourists’ or ‘holidaymakers’.
It was felt that applying the levy to educational trips would create an additional barrier to attending residential / educational trips and deprive children and young people of the residential experience.
The Cabinet Secretary reiterated the impact of eroding the base on the amount of revenue that would be raised by the visitor levy.
There was also a call from the Youth Hostel Association (YHA) and the Children’s Commissioner for Wales for bodies such as not-for-profit, social enterprises and charitable organisations to be exempt from charging the visitor levy.
However, although the Cabinet Secretary made the same argument about the amount of revenue raise from the levy, he went on to say:
… charities—it's a catch-all term for a very, very diverse sector with different legal bases and so on. It can sound straightforward and it can become very complicated when you actually have to, in legal terms, define who you mean.”
The Committee recommended that, in advance of the Stage 1 debate, the Welsh Government should provide the Senedd with a summary of any analysis carried out regarding the potential exemption of under-16s, educational trips and bodies with charitable status.
What happens next?
On Tuesday 1 April, the Senedd will vote on whether to support the general principles of the Visitor Accommodation (Register and Levy) Etc. (Wales) Bill. Should Members of the Senedd support the general principles of the Bill, it will be subject to amendment at Stage 2. The Finance Committee will consider these amendments.
The Bill would then be subject to further amendment by all Members of the Senedd in Plenary (Stage 3) before a final vote on whether to pass the legislation (Stage 4).
You can follow the debate live on Senedd.tv and a transcript of proceedings will be available around 24 hours later.
Article by Christian Tipples, Senedd Research, Welsh Parliament
