Councils across London have launched a campaign to secure a significant portion of the funds generated by a proposed tourist tax, advocating for at least half of the revenue to be retained locally. London Councils, the representative body for the capital's 32 boroughs and the City of London, is pressing the government to ensure that 50 per cent of any overnight visitor levy is kept by boroughs for reinvestment in their communities.
Local Investment and Economic Benefits
The government is currently consulting on proposals that would enable mayors in England to introduce local overnight visitor levies. London Councils argues that retaining a fair share of these funds is essential to sustain the resources boroughs already invest in the tourist economy. This includes managing the impact of tourism through enhanced street cleaning, licensing, local business support, and community safety initiatives.
By localising the funds, the body aims to reassure hotels, businesses, and the hospitality industry in each borough that the levy will directly benefit them and boost the local economy. Additionally, a minimum revenue share for local authorities is seen as a pro-growth incentive, encouraging councils to support the expansion of the tourist sector in their areas.
Pan-London Collaboration and Revenue Distribution
For the remaining funds, London Councils suggests a partnership between the Mayor of London and boroughs to support pan-London services crucial to the tourism industry. This collaborative approach would ensure that broader city-wide needs are addressed while maintaining local focus.
Cllr Claire Holland, Chair of London Councils and leader of Lambeth council, emphasised the importance of this distribution. She stated, "Boroughs shoulder many of the day-to-day costs associated with tourism – from maintaining streets and transport hubs, to supporting cultural venues and managing community safety pressures – helping to keep London attractive, clean, and safe."
Central Boroughs' Role and Funding Pressures
A separate organisation, Central London Forward (CLF), representing 12 central boroughs, has echoed this call for a similar policy once the tourist tax is implemented. CLF predicts that these boroughs alone could generate £275 million from the levy, highlighting their significant role in revenue generation.
However, CLF points out that these boroughs currently lack dedicated funding to manage the pressures of London's visitor economy. They argue that retaining at least 50 per cent of the revenue is necessary to help mitigate the impacts of tourism on local services and infrastructure.
Government Consultation and Future Steps
The government is still finalising the details of the levy's design, and the mayor is awaiting a response before proceeding with its implementation in London. It remains undecided how the money raised from the tourist tax will be split between local authorities and City Hall, leaving the outcome of these campaigns uncertain.
London Councils expressed optimism about working with the government and the Mayor to ensure the levy's success for both Londoners and the tourist industry. The ongoing consultations will play a critical role in shaping the final policy and its distribution mechanisms.
