Unpopular bed tax given go-ahead

Local councils are backing a controversial ‘bed tax’ despite vigorous
opposition from the hospitality industry which forecasts a drop in tourism
revenues by about ?550m a year.

The 5% bed tax to a hotel bill of ?60 per night could see an increase of
about ?100 for a week-long stay.

The Local Government Association has acknowledged it as ‘thoroughly
unpopular’ as a result of endorsing the proposal, which is being considered as
part of the Lyons inquiry into local government finance.

It also stressed that it should be up to local authorities to decide whether
or not to impose the levy, the Financial Times reported.

Coupled with VAT on the levy the tax, if imposed, would bring accommodation
taxation close to the Danish level of 25%, the highest in Europe.

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