Liverpool 'tourist tax' needed to fund culture, council says

A tourism tax is levied in many European countries but is not currently used in the UK

A "tourist tax" on guest accommodation in Liverpool could help to pay for future cultural events in the city, the council says.

Plans to add a £1 levy on hotel rooms were discussed at a council meeting on Wednesday night.

The tax could potentially raise up to £2m a year for the city, cabinet member for culture, tourism and events, Cllr Wendy Simon said.

Imposing a tax would require new government legislation though.

Because of this, the council is also looking at a voluntary scheme too, as well as lobbying government for the legislation.

'Funding crisis'

Events in Liverpool in the 10 years since it won the European Capital of Culture title in 2008 have led to a huge increase in the city's tourism, the council said.

It said the uplift had led to new hotels, restaurants and bars opening in the city centre, resulting in an estimated economic uplift of £100m.

Cllr Simon said the city's budget for culture was shrinking again though.

• Councils look for tourist tax powers

• Edinburgh tourist tax could be £2 a night

• Council moots 'tourism tax' for Hull

She said: "We are in a funding crisis in local government and we are being asked to look at new and innovative ideas."

Bill Addy CEO of Liverpool Business Improvement District (BID) said although a tourist levy was common in other European cities local businesses would need to be convinced.

'How good Liverpool is'

He said: "Private businesses would say, 'we already pay business rates, we are heavily taxed at 20%, we have a BID, that is a levy on private business'."

But he said a new levy on hotel rooms would be a way of providing funding for events and training in the hospitality industry.

He said: "The big free activities we've got used to has to come through public sector money, that money is not available, it is about how we replace that money.

"There is also destination marketing - we have to keep telling people about how good Liverpool is".

A similar tax has previously been suggested by cities including Edinburgh, Hull and Bath.

Liverpool City Council said it would speak to local businesses about how a potential voluntary levy could work.

Analysis: Claire Hamilton, BBC Merseyside political reporter

Unusually for Liverpool, there's cross party political consensus for a tourism levy.

Most people love the Giants, the fireworks and new pieces of public art.

But they all need to be paid for - and with visitor numbers to Liverpool rocketing since it was named the Capital of Culture in 2008, councillors are keen to ensure that more of the cash spent in the region is kept locally.

The council wants government to legislate to give it the powers to make the levy compulsory. Without that, a voluntary tax seems hard to sell to businesses who in the past have been extremely sceptical about such a measure.