With growing concerns over the proposed Visitor Levy, the 182-day rule, and increasing regulation, many tourism businesses in Wales are feeling the strain, with some operators vowing to close or lower their flags to half-mast on St David’s Day (March 1) in a strike to highlight the growing challenges they face.

CLA Cymru states that it wishes to support sustainable initiatives but opposes the Visitor Levy as proposed, urging policymakers to support, rather than restrict, this vital sector.

The Welsh Association of Visitor Attractions (WAVA), supported by organisations such as PASC and North Wales Tourism, have arranged to close their attractions in protest against the anti-tourism policies being pursued by the Welsh Government.

Last week CLA Cymru raised its concerns with all Members of the Senedd (MSs) about details of the proposal; warning that the Bill could weaken the visitor economy, impose excessive burdens on small businesses, and reduce overnight stays that are vital to rural communities.

CLA Cymru states that the Tourism (Visitor Levy) Bill, as currently proposed, clearly risks undermining Wales’ visitor economy by reducing its competitiveness, placing disproportionate burdens on small businesses, and discouraging high-value overnight stays.

Without clarified factual evidence and policy alignment, the Bill could have unintended consequences, harming businesses and local economies rather than supporting them.

Victoria Bond, CLA Cymru Director said “The Tourism Levy risks making Wales an uncompetitive destination, particularly when visitors can choose to travel elsewhere in the UK without facing this charge.

“The lack of a clear evidence base behind this Bill is deeply concerning, and we urge the Welsh Government to reconsider its approach before pushing forward with policies that could force rural businesses to close."

Victoria Bond, CLA Cymru Director said “The Tourism Levy risks making Wales an uncompetitive destination, particularly when visitors can choose to travel elsewhere in the UK without facing this charge.
Victoria Bond, CLA Cymru Director said: “The Tourism Levy risks making Wales an uncompetitive destination, particularly when visitors can choose to travel elsewhere in the UK without facing this charge.” (Pic supplied)

CLA Cymru Highlights Flaws in the Visitor Levy Bill

In an open brief, CLA Cymru outlined to all MSs the fundamental flaws in the Welsh Government’s proposals, including a lack of robust data underpinning the Bill.

Professor Calvin Jones, who authored the Welsh Government’s own Visitor Levy Economic Impact Assessment has warned that there is insufficient understanding of the tourism economy in Wales. Professor Jones described this uncertainty as "a very uncomfortable place for Senedd Members to be when they’re trying to make policy or audit policy on tourism.”

Key Risks Identified by CLA Cymru

1. Economic Impact & Competitiveness

  • The Welsh Government estimates a 1.6% drop in visitor numbers, yet this could still result in a £40 million loss in revenue.
  • Overnight visitors spend four times more (£184 per trip) than day-trippers (£42). Discouraging overnight stays could have long-term economic consequences.
  • Visitors may choose to stay in England to avoid the charge, reducing spending in Wales while still using its infrastructure.

2. Administrative Burden on Small Businesses

  • The Bill does not distinguish between large hotels and small rural accommodation providers, placing a disproportionate burden on smaller businesses.
  • Accommodation providers face extra costs for training, software upgrades, and tax compliance.
  • The threshold for tax remittance is set too low at £1,000, requiring many small businesses to submit quarterly tax returns. CLA Cymru is calling for this to be raised to £2,000.

3. Disproportionate Scope of the Levy

  • Children and infants are included in the levy, despite having negligible impact on infrastructure. Exempting under-16s would only reduce tax revenue by £12 million.[2]
  • Business visitors, who contribute to Wales’ conference and corporate tourism sector, may choose destinations outside of Wales to avoid the charge.
  • Welsh residents would also be taxed, discouraging stay cations and diverting spending away from local businesses.

4. Lack of Coordination with Other Policy Changes

The levy is being introduced alongside other tax increases, including:

  • Stricter business rates criteria for holiday lets.
  • The removal of the Furnished Holiday Lettings tax regime.
  • These cumulative policy changes could force small rural tourism businesses to close.

Urgent Clarifications Needed

To ensure fairness and transparency, CLA Cymru urges the Welsh Government to clarify the following points before proceeding with the Bill:

  • Support for small rural businesses: What provisions will be made to reduce undue administrative and financial pressure?
  • Levy application across Wales: Will the tax be applied uniformly, or will local authorities have discretion to set their own rates? It has been rumoured that some local authorities will set their own tariffs, which could lead to a postcode lottery and offer regional disadvantage.
  • Premium rate charges: How will local authorities determine premium rate tariffs, and how will these align with the economic value of tourism in their areas?
  • Revenue allocation: How much of the levy collected by the Wales Revenue Authority (WRA) will be allocated back to local authorities, and what data will they receive to measure the policy’s impact?