There is a logic to a tourist tax in Britain
As if the British hospitality industry hadn’t experienced enough government abuse, September saw yet another blow: permission for cities to levy a tourist tax on hotel stays. But not quite so fast. Such a tax need not be bad news: it depends on how you levy it. Done cleverly, a tax on hotel rooms could boost revenues for the classier end of the hotel industry. And I have a few ideas on how to do it. Wine-drinkers know that, within reason, spending a few pounds more gets you much more Barolo for your buck The first rule is that you must not levy the tax as a percentage of the room cost – in which case, it will have a downward effect on people’s propensity to spend. Instead, it must be a flat fee.