Edinburgh to Introduce UK's First Tourist Tax on Hotels and More

Edinburgh, Scotland, is making waves as it prepares to implement a "tourist tax" on overnight accommodations, marking a first for the United Kingdom. Starting July 24, 2026, visitors and travelers will face a 5% levy on the cost of their paid stays in the city.

The City of Edinburgh Council explains that the tax will apply to hotels, self-catering apartments, aparthotels, bed and breakfasts, guest houses, hostels, and even unique options like vehicles, boats, and caravan sites. But don't worry, your morning coffee, parking fees, and transport costs won’t be affected—this levy is strictly tied to the accommodation bill before VAT.

For those planning extended stays, there’s a bit of good news: the tax will cap out after the first five consecutive nights. However, whether you're a tourist, a business traveler, or visiting for personal reasons, the rule applies to everyone using paid overnight accommodation—no exceptions for locals or fellow Scots.

The council anticipates that this new measure will generate around £50 million annually (approximately $63 million USD). Councillor Jane Meagher celebrated the initiative as a "historic moment for Edinburgh" and a game-changing opportunity to reinvest in and sustain the city’s appeal for both residents and tourists. She noted the tax has strong support from the local community, who are keen to see the funds improve Edinburgh’s renowned attractions.

While the plan has plenty of cheerleaders, not everyone is raising a glass to the idea. Leon Thompson, executive director of UKHospitality Scotland, expressed concerns that the tax might backfire. "Our fundamental concern has always been that this levy will only serve to make visitors' trips to Edinburgh more expensive, ultimately reducing their spending in the wider visitor economy and deterring future visits," he stated. He also stressed that the council must ensure the funds are used effectively to counterbalance the potentially negative impact on businesses.

The policy is undoubtedly a bold move, one that positions Edinburgh as a trailblazer in the UK. Whether it becomes a model for other cities—or a cautionary tale—remains to be seen.