Levy on city businesses to bring in cash proposed

A levy on accommodation providers in Nottingham is to be considered by the city council.

Councillors are due to discuss plans to introduce a nightly £2 levy , which could help bring in an extra £1.7m a year, at a full council meeting on Monday.

The proposal is being put forward by the city's Business Improvement District (BID) - It's in Nottingham - the Local Democracy Reporting Service (LDRS) said.

It wants to establish a new Accommodation BID, through which it will be able to introduce the charge.

A BID is a non-profit organisation set up in cities and privately funded by local businesses to encourage the growth of the local economy.

Nottingham's BID said the money raised would be invested back into the city.

Under the proposal, accommodation providers within the city boundary – that have a value of £35,000 and over – would be invoiced the BID levy by the economic development department at Nottingham City Council, the LDRS said.

A city council document states: “The levy is based on a £2 per night, per room. This would be based on the occupancy levels of the accommodation providers and would be paid in arrears and reflect actual performance.”

It adds that the total number of rooms that could be subject to the levy each day is 3,160.

The Accommodation BID would be voted for by accommodation providers that fall into the relevant area, the LDRS said.

A general view of Loxley House, Nottingham City Council's headquarters, in Station Street.
City councillors are due to discuss the proposal next week [BBC]

It is not clear in the council report if accommodation providers would have the ability to pass the levy costs on to visitors, if it is voted through.

Similar taxes are popular in European countries such as Spain, Germany, Belgium and France, but they are not currently permitted by law in the UK, the LDRS said.

However, there is a legal workaround, and cities such as Manchester and Liverpool have utilised this to introduce a form of charge on visitors, often referred to as a “tourist tax”.

In Manchester, the levy is known as the "City Visitor Charge" and participating businesses are encouraged to itemise it on guests’ bills, the LDRS said.

Alex Flint, chief executive, of It’s in Nottingham, said: “The proposed Nottingham Accommodation BID will enable strategic collaboration between hotel venues and place-making partners, attract more major events, including sport, music and entertainment to the city, and secure the long-term strength of Nottingham’s economy and visitor appeal.”

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