Seòmar agus comataidhean

During the stage 1 evidence sessions, stakeholders and committee members expressed concern about the potential for the same overnight stay to be subject to more than one visitor levy, for example where an authority chose to introduce multiple, but overlapping, visitor levy schemes.

Amendment 9 in my name responds to those concerns. The effect of the amendment will be that only one visitor levy can be applied to a single overnight stay in particular accommodation on a particular night. That removes the risk that the committee identified. I therefore ask committee members to agree to the amendment.

I move amendment 9.

Amendment 9 agreed to.

Amendment 10 moved—[Ivan McKee]—and agreed to.

Schedule, as amended, agreed to.

Section 10—Commencement

Amendment 11 moved—[Ivan McKee]—and agreed to.

Section 10, as amended, agreed to.

Section 11 agreed to.

Long title agreed to.

As I have said, there is already a mechanism to enable that to happen, through the community impact assessments and through the work that the local authority would need to do by way of consultation, and with the scope that it has to consider different geographical areas in different ways. I am always open to having discussions with members in advance of stage 3, but, for the reasons that I have outlined, I do not think that there is a need to pursue amendment 12.

15:15

I now turn to amendments 23 to 27, in the name of Tim Eagle. I recognise his intention in raising these issues at committee. The amendments all seek to create new national exemptions, focusing on rural and island businesses or residents. Section 14 of the 2024 act permits local authorities to establish local exemptions where those meet the needs of the area. National exemptions should be introduced in a proportionate way to avoid unduly restricting the flexibility of authorities to design schemes that would best suit their local area. For example, a local authority may, if it wishes, design a local scheme that exempts local residents or those who are travelling for business or medical purposes. Local authorities can also introduce different schemes for different areas, and they may exclude rural areas if they wish.

In any event, the amendments all refer to rural areas

“where the population is less than 3,000 people.”

That is unworkable, as the extent of the rural area in question is not defined and cannot be determined. It would be possible to draw any rural area to have fewer than 3,000 people within it.

Amendment 25 would require that the purpose of the trip is not for tourism. That would most likely require the purpose of the booking to be established at the time that it is made. That may not be practicable for accommodation providers, and it would place an additional administrative requirement on them. It may also have implications for third-party transactions, where the final purpose of the trip will not be known at the point when the accommodation is first sold.

Amendment 27 refers to agritourism businesses. It is not clear what is meant here—there is no standard categorisation of agritourism, and the amendment does not provide a definition.

Taken together, those issues mean that amendments 23 to 27 are not workable and, in any event, would unduly restrain the flexibility of local authorities to design appropriate schemes for their areas. That is an important consideration. I therefore ask the member not to move the amendments. If they are moved, I would urge committee members to reject them.

Amendment 30 would add a requirement to the content of the Scottish ministers’ three-year review of the operation of the 2024 act. Section 75 of the act requires that the report must set out an assessment of the impact of a visitor levy scheme on business and communities. The amendment would also require those reports to include an assessment of the scheme’s

“impact … on tourism in rural areas of Scotland”.

I recognise the concern about the potential impact of the visitor levy on rural areas, and I am happy to support the amendment if it is moved, subject to lodging my own amendment at stage 3 to remove the redundant reference to Scotland, as the schemes apply only in areas of Scotland.

Finally, amendment 31 would require the Scottish ministers to make regulations

“to enable a local authority to modify or suspend the operation of a … scheme as it relates to island communities within”

an authority’s area. Section 13 of the act already provides a means by which an authority can modify a visitor levy scheme, including in so far as it relates to island communities, if and when it considers that to be appropriate. Such modifications could include removing island communities from a scheme where islands were part of the wider local authority area. No additional provision is needed to allow for such modification. I therefore ask committee members to reject amendment 31.

Amendment 4 responds to feedback from local government, industry and committee members on the implementation periods that may be applied to visitor levy schemes.

As you may recall, at stage 1, there was consensus on the general principle of reducing implementation periods, but there was no discussion on details as to what those implementation periods should be. I met representatives of industry and local government on 12 February to discuss the issue and seek proposals on what amendments could be made to support quick changes while balancing the need for effective and adequate preparation.

There was consensus on minimum implementation periods for rate or amount increases and for changes between levy bases. Amendment 4 therefore provides that such modifications will require a minimum of six months before they can be brought into effect.

There was less agreement on implementation periods for new schemes. Industry supported the existing 18-month minimum period, while local government considered that the period could be reduced to 12 months. Given those mixed views, I consider that the 18-month minimum period before new schemes can come into force should remain unchanged.

For those reasons, I ask committee members to agree to amendment 4.

I turn to amendment 13, which is in the name of Stephen Kerr. Although I fully recognise the importance of transparency and engagement with business, I do not consider this provision to be necessary or proportionate.

Local authorities are already under statutory duties to consult businesses, communities and other stakeholders before modifying a scheme. They are also expected to consider impacts carefully as part of decision-making processes. The amendment would duplicate those safeguards and impose an additional procedural requirement wherever a proposed increase exceeds the consumer prices index, regardless of the circumstances.

The CPI is not always an appropriate measure of the underlying costs of operating a scheme. In some cases, sector-specific or operational costs may rise more quickly than general inflation. It is therefore important that authorities retain the flexibility to respond to local funding pressures without being subject to an inflexible statutory trigger.

I turn to my amendments 6 and 11. The amendments are intended to avoid unnecessary duplication and delay for local authorities.

Where a local authority has already published and consulted on a draft scheme, the amendment makes it clear that it does not need to reconsult if scheme changes are required solely to reflect amendments made by the bill.

The bill already provides an exception where a scheme has been consulted and reported on, a decision to proceed has been published and the proposed start date of the scheme has been publicised. The amendments simply extend the same approach to schemes that are slightly earlier in the process.

As with the equivalent provision for existing schemes, the associated amendment would commence the new section automatically two months after royal assent. It recognises that councils should not be disadvantaged where they have already undertaken consultation.

Overall, the amendments support a consistent, proportionate approach and help to ensure timely implementation. They do not remove the requirement for local authorities to consult on new schemes. I ask members to reject amendment 13 and to agree to amendments 6 and 11.

I move amendment 4.

I recognise the intent behind amendment 19 that, following each three-year review of a visitor levy scheme, a local authority should provide a clear indication of whether it wished to continue with or revoke the scheme. However, if the report included a decision that a scheme should expire, the amendment would require the scheme to expire as soon as the report was published. It would therefore remove the local authority’s discretion to revoke the scheme at a future date of its choosing, by requiring immediate expiry. That would give no advance notice and no time for modifications to the scheme to allow for a transition out of the scheme ahead of its expiry. Immediate expiry is likely to create administrative difficulties for accommodation providers if payments that have been collected from visitors in order to offset levies need to be reimbursed, and for local authorities in collecting unpaid levies.

The point that I made is that the local authority already has the power to exit a scheme if it chooses to do so, which is sufficient in that regard, rather than compelling it to have to consider doing so periodically. That is not something that it would do with other taxes, except on an exceptional basis.

That opportunity is already there, because local authorities can decide at that time, or indeed at any other time, to exit the scheme if they think that that is more suitable for their area, having taken input from local businesses and others, which they would constantly do.

I ask Mr Kerr not to press amendment 19 and, if he presses it, I ask committee members to reject it.

Amendment 29 seeks to prevent local authorities from imposing a penalty where the basis for that penalty has arisen as a result of an accommodation provider relying in good faith on information from a third party. I understand the intention behind it, which is to protect accommodation providers who have acted in good faith, and I acknowledge Stephen Kerr’s comments about small businesses and microbusinesses having to operate the system and complete paperwork as appropriate. As someone who has run small businesses, I am well aware of the challenges that that presents, and, throughout the process, we have worked hard to listen to industry and to make the tax as easy to operate as possible by taking input from the sector. However, with regard to amendment 29, I do not consider the proposed change to be necessary.

Section 46 of the 2024 act already provides local authorities with proportionate enforcement powers. There are existing safeguards that mean that penalties will not apply where a liable person has a reasonable excuse for a failure to comply. The act provides that reliance on another person is not generally a reasonable excuse, but it can be, if the liable person took reasonable care to avoid the failure. Therefore, I believe that amendment 29 is not necessary to achieve the member’s intention.

By introducing a broad statutory defence, amendment 29 could significantly restrict enforcement action in practice. It could make penalties more difficult to apply and require authorities to resolve disputes about what constitutes good-faith reliance before taking action. Existing safeguards, including review and appeal rights, already protect providers from unfair or disproportionate penalties.

I therefore urge Stephen Kerr not to press amendment 29, and if it is pressed, I urge committee members to reject it.

Will Stephen Kerr give way?

Amendment 12, in the name of Stephen Kerr, would prevent a local authority from imposing a visitor levy

“if that levy would worsen geographic disadvantage felt by rural or island communities.”

Although I can appreciate that there are concerns about the potential impact on island or rural communities, amendment 12 does not help to address them; it creates only uncertainty for authorities in deciding whether they can apply a levy in those areas.

I have nothing to add, convener.

Amendment 4 agreed to.