THE possibility of a tourist tax being introduced in Cornwall looked more likely this week with the announcement that mayors and Foundation Strategic Authorities will be given the power to charge an overnight levy on visitors.

The news comes just a couple of weeks after Prime Minister Andy Burnham told us he would be keen to give Cornwall Council the power to make that choice.

With the announcement, local leaders will be allowed to bring in an uncapped levy, dubbed a ‘tourist tax’, as a percentage of the cost of hotels, bed and breakfasts and other types of accommodation rather than a flat fee.

Many hospitality leaders are not happy with the proposal, saying it could lead to job losses as holidaying families feel the extra pinch. UK Hospitality has written to the Prime Minister urging him to consider plans for a ‘holiday bonus’ instead, as households continue to struggle with the cost of living.

It is understood the levy would have no upper limit, though Government sources said mayors / strategic authorities were unlikely to make it too costly, with most indicating it would be a few per cent.

Under the plans, mayors and leaders of Foundation Strategic Authorities – which cover some regions without a mayor, with Cornwall likely to be announced as a strategic authority without a mayor in the coming weeks – would need to clarify by March 2028 how they would spend the new revenue.

Two cities in England already run their own voluntary schemes – a £1 per room, per night City Visitor Charge in Manchester, introduced when Burnham was mayor, and a £2 nightly charge in Liverpool.

During an interview while in Truro last month, the Prime Minister told us: “I am prepared to look at an overnight visitor levy for Cornwall. People in the tourism industry might say ‘woah, hang on, what will that mean for us?’ but it’s something that tourists from Britain are paying all over Europe this summer, so actually it could be something of a game changer for Cornwall.

“I don’t think people resent the idea of a few extra pounds on a hotel or Airbnb bill because you’re using the services. It’s not fair, actually, to pay for all of the services and infrastructure from council tax – that’s a burden that residents can’t carry on their own.

“Cornwall wouldn’t have to do it, but it’s just there as a possibility and I’m keen to not just give that power to mayors if there are parts of the coastal and rural economy that want those powers early and are prepared to move early for a devolution deal.

“I think it could be a major game changer in Cornwall, if it’s pitched the right way. Just start with a level that is fair. That is a new revenue stream and then you can borrow against that revenue stream.”

The matter was briefly discussed at a meeting of Cornwall Council’s community wellbeing committee today (Thursday, September 10).

Cabinet member Cllr Sarah Preece said she will be attending a Cornwall Chamber of Commerce summit in Newquay tomorrow where the pros and cons of an overnight visitor levy will be discussed.

She told the meeting: “From my point of view, as cabinet member for tourism, this is an opportunity to listen to the sector about where their concerns and issues are.

“As many of you will be aware, there was an announcement today that the decision is coming to strategic authorities as well as mayoral authorities. We are anticipating being a strategic authority, which is now looking very imminent. With that strategic authority will come additional powers.”

She said the full detail around a tourist tax “has been absent and we will need detail in order to be able to look into the levy. There would be a full engagement process with key stakeholders and members and it will ultimately be a decision for the full council”.

Cllr Preece added: “It’s a potential gift and also a potential burden, as it’s one of those topics that will divide many people.”

Committee chairman Cllr Andrew Mitchell said he was pleased to hear Cllr Preece was meeting with industry representatives “regarding the possible implication” of a tourist tax. “My real concern at this moment at Cornwall Council with a gap in leadership and a horrific position on our budgets is that this could be a distraction. It’s not a clear, easy win for the council to get money.”

Cllr Mick Barton, chair of the Local Government Association’s Culture, Tourism and Sport Committee, said today: “Local communities know best and we are pleased that the Government has said it should be up to them to decide whether to implement this levy.

“While we recognise the strong concerns expressed about an overnight visitor levy by the hospitality sector, when designed locally, in consultation with residents and business, it could enable significant investment in the wider visitor economy. That’s why it’s vital that councils retain a portion of the funding raised to support the services they provide which serve the visitor population.”

On the flipside, Richard Bond, owner of Finest Retreats, the UK’s largest independently owned holiday let management company, thinks the move is short-sighted.

He said: “This is another blow to the UK’s tourism industry. Disguised as empowering local government, it’s essentially an anti-growth policy. For areas that introduce the visitor levy, fewer visitors could mean lay-offs, or at the very least, fewer seasonal hires, especially considering these businesses are already absorbing higher National Insurance and minimum wages costs, none of which were in the manifesto.

“The UK’s tourism hotspots rely on visitor spending. If a nearby area introduces the levy and Cornwall doesn’t, being the cheaper option will mean visitors will follow and more trade and seasonal jobs will be created. But get it wrong and the opposite is true. This is a stark test of how much each community depends on tourism for their local economy, and frustrating for the business owners who aren’t a part of the decision yet have to shoulder the fallout.”