Agenda item

To submit the report of the Cabinet Member for Economy and Community.

 

RESOLVED:

 

1.     To publish the Gwynedd Visitor Levy Proposal Report;

2.     To agree to hold a consultation on the Proposal to introduce a Levy in accordance with the list of consultees in paragraphs 5.4 and 5.5 of this report;

3.     To notify the Welsh Revenue Authority, in accordance with the statute, and to share the Visitor Levy Proposal Report with the body.

 

The report was presented by the Cabinet Member for Economy and Community, setting out the reason for considering the Visitor Levy i.e.to ensure that the tourism sector contributes fairly towards the cost of the pressure this placed on local services, the environment, the Welsh language and the county's communities. It was added that the levy was a means of reinvesting in the visitor economy for the benefit of residents and businesses.

 

The current situation was highlighted, namely that millions of visits to Gwynedd each year created increasing pressure on local services at a time when budgets were under pressure. According to the Welsh Government, the levy was identified as a potential solution as it requested a small contribution from overnight visitors to be reinvested locally, with local control and transparency. It was stressed that the proposal was not an anti-tourism development but rather sought to manage and strengthen the economy in a sustainable way in the long term. It was reiterated that there were several ways of measuring the visitor economy, and that these were reflected in the impact assessments, gave a different dimension to the economy of Gwynedd and therefore the affected impact assessments.

 

Attention was drawn to the comments received from the Education and Economy Scrutiny Committee which included the need for a thorough consultation to be carried out and a firm commitment on spending the money.

 

It was expressed that a detailed process would be adopted if the levy was desired, and it was noted that the national rate was 75p excluding VAT for the lowest scale (which included campsites and hostels) and £1.30 excluding VAT on the highest scale. It was noted that all persons staying overnight would be expected to pay the levy but that exceptions existed. It was explained that the Council had considered the potential of introducing a levy for several years, with Benefiting from Tourism research from 2018 highlighting the levy as the source that would bring the most income to Gwynedd to invest in the visitor economy.

 

It was explained that the question today was to determine whether a public consultation process should be implemented, and the results would be considered when a final decision was made by the Full Council. It was highlighted that the Council was working closely with Conwy and Anglesey on carrying out impact assessment research, and that discussions had taken place with Cardiff Council who had decided to adopt a levy following a consultation process.

 

It was noted that the impact assessments had been developed under the guidance of the Welsh Government, and it was noted that the assessment indicated that the levy could lead to losing 50 jobs at worst or creating 21 jobs at best. In terms of revenue, it was expressed that this ranged from £2.4m when using one dataset to over £12m if another was used. It was therefore anticipated that the amount would be higher than that stated in the Levy Proposal.

 

It was explained that the consultation procedure was set out in the act and clearly set out where the levy income can be invested, along with the need to establish a Levy Partnership Forum at local authority level. It was highlighted that the proposal highlighted that income should be invested in projects and activities that aligned with the Gwynedd and Eryri 2035 Plan's sustainable visitor economy principles such as improving toilets, public transport and supporting events.

 

It was expressed that if there was support, they intended to hold a consultation process on 20 May for a period of eight weeks before returning to the Full Council on 24 September. It was stressed that no final decision on the adoption of the Levy would be made until after the consultation process.

 

Members were given an opportunity to ask questions and offer observations.

 

An understanding of the benefits of having a levy was noted, and there was agreement with the idea in principle but there were also concerns such as how to enforce it. It was noted that while the report highlighted how it would bring in money, the report did not demonstrate how it could work without having a negative impact on tourism in the county. It was expressed that tourism and the hospitality sector affected a lot of businesses and that the introduction of the levy may be a risk of a reduction in business. It was emphasised that we should pause to see what the impact was on other counties and gather data before making a decision.

 

Members were reminded that today's report was to determine whether to go to consultation to ensure that voices are heard, from residents, people working in the tourism sector and business owners. It was expressed that tourism had an impact on areas such as the language and that this would provide input to the costs locally, but it was highlighted that this was not part of today's decision.

 

It was emphasised that many consultations were carried out by the Council. It was added that the room tax was already 20% for businesses and hence was there a need to charge more. It was expressed that the economy was already fragile and therefore they had to be careful that no anti-tourism messages were shared.

 

It was pointed out that tourism was currently decreasing in the county because of decisions such as raising business tax and article 4, and that there was a need to hold back and have time to stabilise. It was pointed out that hospitality tax was around 7% in overseas countries, therefore much lower than Gwynedd, and that further data was needed.

 

It was expressed that it was the right time to consult, and it was pointed out that Edinburgh had the highest levy in Europe. It was highlighted that the number of visitors had risen because money had been invested to improve the city. It was declared that this was an opportunity to improve the experience of both visitors and residents.

 

The consultation was welcomed but it was pointed out that the report did not highlight overtourism in the county. It was elaborated that the benefits of the money were being used to mitigate the negative impact on communities and that there was a need to invest in tourism without encouraging more tourism. The need to word the consultation well was expressed and it was asked who would scrutinise the wording itself. The Monitoring Officer responded by stating that the process was in accordance with the act.

 

It was highlighted that there were obvious challenges with tourism but there were positive elements through the vibrancy it creates, and we must be proud that visitors from all over the world are visiting the county. It was expressed that the levy provided the potential to invest the money to support businesses and that it was an exciting opportunity to spend it in a sustainable way and to ensure that residents can enjoy living in the area.

 

The decision was supported and the member stated that people of his ward would be happy to see the money invested in improving facilities and that advantage should be taken from this to raise standards and to police individuals who disrespect the area.

 

In terms of the data, it was noted that there was no data available locally to see what the effect of the levy was but that data from other countries could be used. It was highlighted that if we wait to see the results in neighbouring counties, this could become a lengthy process due to the law's processes. It was expressed that the consultation would generate data from the views of local people and businesses which would be used to make the decision in September.

 

The people of Gwynedd, if agreed today, were asked to respond to ensure that their voices are heard.

 

The idea was supported in principle but needed to be absolutely clear to taxpayers. The importance of coupling this decision together with Article Four and the Premium was expressed, ensuring that unforeseen side effects do not negatively hit local people. The need to be careful when introducing this was emphasised, but it may be a fairer way of raising income than the premium.

 

It was asked what the risk of delaying this for a year was, and the response noted that a delay would not change the situation in terms of data as there was a preparation period of one year before being implemented therefore no additional data would be available.

 

It was asked whether this tax would be imposed on locals as well, should they be staying in another part of the county on their holiday. The response was that the levy would be imposed on anyone staying overnight in Gwynedd.

 

It was proposed to defer the item as there may be a gap in the consultation, and it would be possible to analyse the Conwy and Anglesey data for more information. It was explained that time could be taken to ensure that Gwynedd's consultation was accurate. The motion was voted on, and the motion fell so the original motion was voted on.

 

RESOLVED

1.    To publish the Gwynedd Visitor Levy Proposal Report.

2.    To agree to hold a consultation on the Proposal to introduce a Levy in accordance with the list of consultees in paragraphs 5.4 and 5.5 of this report.

3.    To inform the Welsh Revenue Authority, in accordance with the statute, of the intention to consult on the introduction of a Levy in Gwynedd.