Local authorities across England are set to gain new powers to implement tourist taxes on overnight stays, following announcements in the government's Autumn Budget 2025. The landmark decision will enable city mayors and town officials to charge modest fees for accommodation in hotels, B&Bs, guesthouses and holiday lets.
Aligning with International Standards
This significant policy shift brings England in line with other UK nations and major global destinations including New York, Paris and Milan, where charges on short-term stays have been standard practice for years. The move recognises England's substantial tourism appeal, with the country alone attracting over 130 million overnight stays annually.
Steve Reed, Secretary of State for Housing, Communities and Local Government, emphasised the potential benefits on the UK Government website. "Tourists travel from near and far to visit England's brilliant cities and regions," he stated. "We're giving our mayors powers to harness this and put more money into local priorities, so they can keep driving growth and investing in these communities for years to come."
Local Initiatives Gathering Momentum
Several regions have already expressed strong interest in implementing the overnight stay levy. In London, Lambeth Council is proposing what it calls the "Love Lambeth Levy" to help manage tourism impacts and fund community improvements. The borough encompasses popular areas including Brixton, Clapham, Vauxhall, Streatham and Norwood, which have seen significant growth in tourism thanks to vibrant markets, bars and dining scenes.
Lambeth Labour explained in an online petition: "We're incredibly proud of this, and we want to do everything we can as a council to expand and strengthen our borough as a leading destination to visit and live in. The revenue could be allocated towards public realm improvements, such as street cleaning and general upkeep."
Meanwhile, Greater Manchester authorities have been particularly vocal in their support. Mayor Andy Burnham described the measure as "something we have long called for," telling Bolton News that "Greater Manchester already has a thriving visitor economy, and a visitor levy will help us sustain good growth over the next decade."
Proven Success and Future Plans
Manchester has already demonstrated the potential of such schemes through its voluntary £1-per-night "city visitor charge" introduced in April 2023. Although technically optional, the charge raised an impressive £2.8 million in its first year as most guests contributed, with funds directed toward street cleaning and other local services.
Mr Burnham now aims to implement a compulsory tourist tax ahead of the Euro 2028 Championship, with England's players scheduled to begin their campaign at Manchester's Etihad Stadium. The government has also suggested Liverpool could benefit from similar measures to improve infrastructure and support major events.
The decision to introduce these levies remains entirely with local leaders, allowing them to determine what works best for their communities. A 12-week consultation period will enable businesses, communities and other interested parties to contribute their views on how the scheme should operate.
This progressive approach to tourism funding represents a significant step toward sustainable visitor economy management, potentially creating a virtuous cycle where improved services and infrastructure attract even more visitors to England's diverse towns and cities.
