The idea of making visitors contribute directly towards the cost of tourism in the Highlands is back on the table.
The prospect of a visitor levy being introduced across the Highlands has moved on to another stage, but a charge on overnight stays is still some way from becoming a reality.
Highland Council is being asked to approve a draft scheme for public consultation. It is not being asked at this stage to introduce the levy.
If councillors agree, there will be a statutory public consultation lasting at least 12 weeks. The responses will then be considered before the Council decides whether to proceed, and if it does, what the final scheme should look like. A further report is expected to come before the Council in December 2026.
The latest proposal is substantially different from the percentage-based scheme which was consulted on in 2024 and 2025.
From 5% to a fixed charge
The original Highland proposal was based on a levy of 5% of the cost of overnight accommodation.
That consultation ran from November 2024 until March 2025 and attracted more than 4,000 responses. The Council’s subsequent analysis identified a number of recurring concerns, including the complexity of a percentage-based system, the administrative burden on smaller accommodation providers, VAT and third-party booking costs, exemptions, and the treatment of motorhomes and campervans outside licensed campsites. There was also a recurring preference among accommodation providers for a simpler flat-rate system.
The consultation did not produce a verdict against a visitor levy. Rather, it highlighted considerable differences of view about how such a levy should operate.
The legislation has also changed since that consultation.
The Visitor Levy (Scotland) Act 2024 gave local authorities the power to introduce a levy on overnight accommodation. The Visitor Levy (Scotland) Amendment Act 2026, which received Royal Assent on 21 May 2026, expanded the options available to councils, allowing fixed amounts and tiered fixed amounts as well as percentage-based charges.
Highland Council is now proposing a tiered fixed-rate system, charged per room or accommodation area per night.
What would visitors pay?
The proposed rates are:
£5 per room or accommodation area per night for hotels, short-term lets, rooms in houses, inns, pods, cabins, guest houses and B&Bs.
£2 per night for campsites and hostels.
The charge would apply to the accommodation unit rather than to each person staying in it.
So, for example, a room costing £100 a night and occupied for five nights would attract a £25 levy, making the accommodation and levy £525 before any VAT implications.
A family occupying the same room would still pay £25 rather than £25 per person.
The Council says £5 is intended to provide meaningful revenue while being unlikely to have a greater effect on visitor demand than a percentage-based alternative. The lower £2 rate for campsites and hostels reflects their generally lower-cost nature.
It would cover the whole Highland Council area
The proposal is for a single scheme covering the entire Highland Council area, rather than different rates in different parts of Highland.
It would cover hotels, hostels, guest houses, B&Bs, self-catering accommodation and short-term lets, as well as paid accommodation on caravan and camping sites.
The proposal also covers static and touring caravans, campervan and motorhome pitches and temporary tent pitches. Accommodation in a vehicle or vessel which is permanently or predominantly situated in one place would also be included.
Motorhomes and campervans staying outside commercial sites would not be covered by the levy under the Scottish legislation.
Cruise passengers are also outside the scope of the legislation.
The exclusion of off-site motorhomes and campervans was one of the issues raised during the previous consultation. The Council makes clear that this is a consequence of the Scottish legislation rather than a decision made by Highland Council.
It would not operate throughout the year
The main proposal is for the levy to operate for nine months of the year, excluding December, January and February.
Section 6.4 of the Council’s report says the levy would apply for nine months, excluding those three months. Appendix 4, Section D, also describes the proposed charging period as “March through November”.
The Council’s reasoning is that a fixed charge would have a greater relative impact during quieter periods and that removing the levy during the low season could reduce that effect and potentially encourage businesses to extend their seasonal opening periods.
There is, however, an error or inconsistency in the published proposal
There is a different date given elsewhere in the same report.
Section 6.19, dealing with discretionary exemptions, says that the low-season exemption would mean the levy “will not apply between 1 November to 31 January inclusive.”
That would exclude November, December and January and would produce an eight-month charging period, rather than the nine months described elsewhere.
The wording in Section 6.19 therefore conflicts with the description in Section 6.4 and Appendix 4, Section D, both of which point to a March-to-November charging period.
The report does not explain the discrepancy. It appears likely to be a drafting error in Section 6.19, but that should be clarified by Highland Council before the meeting on 25th August, any consultation which follows, and any final scheme is adopted. We have saved the proposal which appears to have a drafting error and will monitor
How much could it raise?
Using VisitScotland data, the Council estimates approximately 2.4 million chargeable room nights a year under the proposed nine-month model.
Its current estimate is around £9.8 million in gross annual income.
That figure is indicative rather than guaranteed and will be affected by visitor numbers, occupancy levels, the final rate and any changes resulting from the consultation.
The £9.8 million should therefore not be regarded as £9.8 million available to spend.
The Council estimates that administering and managing a visitor levy could cost approximately £550,000 a year.
Accommodation providers would also be allowed to retain 5% of the levy they collect to help cover the costs of collecting and administering it.
The Council is also considering a contingency reserve of up to 5% of levy income.
The amount ultimately available for investment would therefore be lower than the £9.8 million gross figure.
Who would collect it?
Accommodation providers would act as the collection point.
They would be responsible for collecting the levy from visitors and submitting quarterly returns through the national online visitor levy system.
The returns would record the accommodation charges subject to the levy and the amount collected, with payment made alongside the return.
Providers would also have to maintain records of transactions subject to the levy. Highland Council would have powers to monitor compliance and carry out checks, with penalties available where the rules were not followed.
The proposed 5% retention is intended to recognise the administrative work involved for accommodation businesses.
Would any visitors be exempt from paying?
There would be a number of statutory exemptions and exclusions.
People staying in accommodation which is their only or usual residence would not be liable.
The legislation also provides protections for certain people experiencing socio-economic disadvantage, including people who are homeless or at risk of homelessness, refugees and asylum seekers, and people whose homes are unfit or unsafe for habitation.
There are exemptions for people receiving specified disability benefits and the Council is also proposing exemptions for certain carers.
Accommodation on local authority and registered social landlord Gypsy/Traveller sites would not be subject to the levy.
Neither would free accommodation, seasonal caravan pitches unless they are sub-let to another visitor, or motorhomes and campervans staying outside commercial sites.
What about Highland residents?
This is one area where the Council has decided not to introduce a specific Highland resident exemption.
The previous consultation identified support for an exemption for Highland residents and people travelling within Highland for essential purposes such as medical appointments and work commitments.
The Council’s latest assessment is that checking proof of Highland residence, collecting the levy and then processing refunds would be complicated and expensive.
Under the proposed arrangement, Highland residents would therefore pay the levy when staying in chargeable accommodation.
For people who have to stay overnight in the Highlands for hospital treatment, the Council proposes instead to provide a financial grant directly to NHS Highland to offset the levy costs.
The Council says this would avoid the administrative difficulties of an individual exemption or refund system while reducing the impact on people requiring essential healthcare.
There is also a VAT issue
Another cost which visitors may notice is VAT.
The Council says that, based on the current interpretation from HMRC, the visitor levy is expected to form part of the VAT-able value of accommodation.
Where an accommodation provider is VAT registered, VAT would therefore be applied to the levy.
This means that a £5 levy could result in a visitor paying more than £5 in additional charges where VAT applies.
The Council notes that this position is ultimately a matter for the UK Government.
Where would the money go?
Scottish legislation requires net visitor levy income to be used to support the objectives of the scheme and to sustain, support or develop facilities and services substantially used by visitors.
Highland Council has proposed four broad areas for investment.
50% would go towards visitor infrastructure and services.
This could include public toilets, parking, waste and litter services, visitor information and signage, paths, viewpoints and lay-bys, public transport and active travel, digital visitor management, ranger services and support for Police Scotland activity relating to visitor management, road safety and community safety.
15% would be allocated to helping communities benefit from tourism.
The proposal includes the possibility of a Visitor Levy Housing Investment Fund, which could help address tourism workforce accommodation and housing pressures arising from visitor demand.
It also suggests a Community and Cultural Tourism Investment Fund, community-led tourism projects, improvements to local amenities and public spaces, support for community organisations and enterprises, and other projects identified through local priorities.
20% would support culture and heritage.
This could include events, entertainment, cultural and heritage assets, with the intention of encouraging longer stays and spreading tourism activity more widely across Highland.
15% would support business growth and a skilled workforce.
Possible areas include business support and innovation grants, tourism and hospitality training, apprenticeships, digital development, destination development and collaborative programmes with organisations including Business Gateway and Highlands and Islands Enterprise.
The proposed percentages are indicative, rather than a final spending programme.
The Council also proposes that environmental stewardship, climate resilience and sustainable tourism principles should be considered across all four areas rather than receiving a separate percentage allocation.
How would decisions about the money be made?
A Highland Visitor Levy Forum would be established within six months of any decision to introduce the scheme.
It would include representatives from communities, tourism businesses and tourism organisations and would advise on the operation of the scheme, investment priorities, use of levy income and future reviews.
The Forum would not control the money.
Final decisions on allocating levy income would remain with Highland Council through its normal governance and budget-setting arrangements, taking account of the Forum’s advice and the statutory requirements.
Keeping track of the money
The proposal includes a number of reporting requirements.
The Council would maintain separate accounts for visitor levy income and publish an annual “Levy In, Levy Out” report, setting out how much has been collected, administration costs, expenditure, progress against the scheme’s objectives and the outcomes achieved.
The Council also proposes reporting the geographical distribution of investment.
A formal review would take place at least every three years, looking at the effects of the scheme on accommodation providers and the wider visitor economy, visitors and local communities.
The review would also provide an opportunity to consider the effect of inflation on the fixed levy rate.
What happens next?
If councillors approve the draft scheme for consultation, there will be a statutory consultation lasting at least 12 weeks.
People will be able to comment on the proposed levy model and rate, geographical coverage, exemptions, use of revenues, governance, likely effects on businesses and communities, implementation arrangements and monitoring and review.
The consultation is therefore about considerably more than simply whether people support a £5 charge.
The responses can influence the design of the scheme before it comes back to councillors.
If Highland Council subsequently decides to introduce a levy, there would then be an 18-month implementation period before it could come into force.
The Council’s current report proposes that a further report should come to the December 2026 Council meeting following the consultation, setting out the consultation results, a final proposed scheme and rate, detailed implementation arrangements and a recommendation on whether Highland should adopt a visitor levy.
There is therefore no Highland visitor levy yet.
What is now before councillors is a revised proposal, developed following the earlier consultation, further engagement with the tourism sector and changes to Scottish legislation.
The consultation, if approved, will give accommodation providers, tourism businesses, communities, residents and visitors another opportunity to examine the detail and suggest changes before any final decision is made.
Biggest question must surely be
Where is the Economic Impact Assessment?
Looking to France: a visitor tax that has been operating for more than a century
There is another way of looking at The Highland Council’s proposed visitor levy, and that is to look across the Channel.
France has been operating a comparable system, known as the taxe de séjour, since 1910. What began as a charge that could be imposed by designated tourist resorts has gradually developed into a well established part of local tourism funding.
It is now a local tax that can be introduced by eligible communes, including tourist resorts, mountain and coastal communes, and those undertaking tourism promotion or protecting and managing natural areas. It can also be introduced by intercommunal bodies, known as EPCI.
It is not a single nationwide rate. French national legislation establishes the framework and maximum rates, while the local authority decides whether to introduce the tax and sets its rates within that framework.
That makes France an interesting comparison for Highland.
The French system has evolved over 116 years
The taxe de séjour was created in 1910, initially for officially classified tourist resorts.
Its scope was subsequently widened. Mountain communes became eligible in 1985, coastal communes the following year, communes carrying out tourism promotion activities in 1988, and those undertaking protection and management of natural areas in 1995. From 1999, qualifying intercommunal bodies could also introduce the tax.
In other words, the French system was not created in its present form overnight. It has been expanded and altered over more than a century as tourism itself has changed.
The underlying idea, however, has remained remarkably familiar: places attracting visitors can raise money from tourism and use it to support the infrastructure and services associated with tourism.
What do visitors actually pay?
France does not have one standard rate.
The charge varies according to the type and classification of accommodation, with the permitted rates set nationally and local authorities choosing their rate within the legal limits.
For 2026, the standard statutory scale ranges from relatively modest charges for basic accommodation and campsites to considerably higher maximum rates for luxury accommodation.
For example, the national 2026 ranges include:
- Palaces / chateaux / castles: €0.70 to €4.90 per person per night
- Five-star accommodation: €0.70 to €3.60
- Four-star: €0.70 to €2.60
- Three-star: €0.50 to €1.70
- Two-star: €0.30 to €1.00
- One-star accommodation and certain other accommodation: €0.20 to €0.80
- Three to five-star campsites: €0.20 to €0.60
There are also different rules for accommodation without a classification. In those cases, the charge can be calculated as a percentage of the cost of the accommodation, subject to the statutory limits.
France does not apply one charge to every type of accommodation.
France generally charges per person, not per room
There is another major difference between the French model and Highland Council’s proposal.
The ordinary French system, known as taxe de séjour au réel, is calculated according to the number of people staying and the number of nights.
So if two adults stay for five nights, the charge is calculated for ten person-nights.
That is different from Highland Council’s proposed £5 per room or accommodation area per night.
Under the Highland proposal, a room occupied by one person and the same room occupied by four people would attract the same £5 nightly levy.
In France, four people staying in the same room would normally generate four times the per-person charge.
France also has a flat-rate system, known as taxe de séjour forfaitaire, which is calculated according to the capacity of an accommodation establishment and the number of nights for which it is available. A local authority can also operate a mixed system.
So there is actually more than one French approach available, rather than a single model.
Who collects the money?
Under the normal system, the accommodation provider collects the tax from the visitor.
The hotel, guest house, holiday rental, campsite or other accommodation provider effectively acts as the collection point. The visitor pays the levy as part of the cost of their stay and the accommodation provider subsequently accounts for it and passes the money on to the relevant local authority.
Online booking platforms have also been brought into the system.
Since 1 January 2019, qualifying digital booking platforms have been required to collect the tax in the circumstances set out in French law. The platforms then remit the money according to the rules governing their collection obligations.
This means France has built a system which can operate across traditional accommodation businesses and increasingly through the online booking market.
There is a central system behind the local taxes
Although the tax is local, France has a national administrative framework supporting it.
French local authorities enter their adopted rates and other details of the visitor tax into DELTA, an online application developed by the Direction générale des Finances publiques (DGFiP), France’s public finance and tax administration. DELTA does not collect the tax itself. It provides a central record of the rates and rules adopted by each local authority, with the information published so visitors and accommodation businesses can see what applies. The data is also made available to online booking platforms, allowing them to apply the correct local rate when they are responsible for collecting the tax.
For a system which operates across thousands of local authorities and accommodation businesses, there is a certain simplicity to having that information held centrally. A visitor may simply see a small additional charge on their booking, but behind it is a system linking local councils, accommodation providers, booking platforms and the national tax administration.
Where does the money go?
French law specifically links the revenue to tourism development. The official guidance describes the tax as being allocated to the development of tourism.
It can therefore support tourism related activities and facilities, including the work of tourism organisations and measures intended to improve the attractiveness of the destination.
Highland Council is proposing its own defined allocation of the money, including visitor infrastructure, culture and heritage, community projects and wider visitor economy investment.
France provides a long established example of the principle that money collected from visitors can be tied to tourism rather than simply disappearing into an authority’s general finances.
It is not simply a case of collecting the money and passing it to councils
The French system also contains rules covering exemptions, declarations, collection, payment, enforcement and penalties.
For example, children, seasonal workers employed in the commune and people staying in emergency or temporary accommodation are among those exempt under the national rules.
There are also arrangements for checking declarations and dealing with cases where the tax has not been correctly collected or paid.
That administrative infrastructure has developed over many years.
For Highland Council, which estimates that administering its proposed levy would cost around £550,000 a year, the French experience raises an interesting question about how much administration is actually required once a scheme becomes established.
France and Highland are not directly like-for-like
France has a much longer history of local tourism taxation, a different local government structure and a national tax administration able to provide systems such as DELTA. The Highland Council would be creating a new system within Scotland’s existing local government and tax arrangements.
The French model also has considerably more variation between accommodation types than Highland Council is currently proposing and France’s tax is generally based on the individual visitor, whereas Highland’s proposal is based on the room, pitch or accommodation area. It does though provide something valuable: a real world example of what happens when a visitor levy becomes a normal part of the tourism system rather than a new idea being debated for the first time.
More than a century of experience
Perhaps the most striking thing about the French example is simply its longevity. The taxe de séjour has been around since 1910.
It has survived changes in tourism, the growth of mass tourism, the arrival of holiday rentals and the transformation of the way people book accommodation. Its administration has also been adapted to include online platforms.
For Highland, the French experience offers plenty to examine. It is also how the money is collected, how businesses are expected to administer it, how online booking platforms fit into the system, how rates are published, how exemptions work, how the money is protected for tourism related purposes and how the whole arrangement is monitored.
With The Highland Council now considering a 12 week consultation on its own proposal, the French experience provides a useful comparison for anyone trying to decide whether the Highland model is the right one, or whether there are lessons to be taken from a system that has been operating for more than a century.
Read the proposal for the Highland Visitor Levy it will be the subject of a special meeting of The Highland Council on Tuesday 25 August 2026 at 9.30am.
