Fife Council Considering A Tourist Tax

Fife Council is considering implementing a tourist tax, an extra charge on top of accommodation costs for visitors staying in Fife. The Council has stated that this is subject to conversation with local businesses and communities.

The Visitor Levy Act was passed in Scotland last year, granting local authorities the right to implement such a tourist tax. The money raised is then passed onto local councils to spend on visitor economy projects. Edinburgh City Council is the first council to implement a five per cent tax on paid accommodation, which is set to take effect next summer.

As well as Fife Council, Highland, Argyll & Bute, Falkirk, and Perth and Kinross councils are all now looking at the possibility of introducing a tourist tax.

In a Cabinet Committee meeting on 3 April, Fife councillors were told that early research indicated that a visitor levy scheme which charged five per cent (in line with Edinburgh City Council) would generate between £3.4 million and £8.2 million per annum.

However, while Fife Council is considering the cost-benefits of a tourist tax, the tax would not be put in place until April 2028 at the very earliest.

First, the Council plans to undertake a nine-month consultation, culminating in a report for councillors to review in January 2026. An officer has been assigned to oversee the initiative for the next year. Once a final decision is made, there will be an eighteen month notice period required before the policy can be implemented.

Councillor Kathleen Leslie, Conservative Council Group leader, stated: “There is a lot that is very unclear, and it feels like another tax being imposed. I do not want people being put off coming to Fife.”

Julie MacDougall, Councillor for Burntisland, Kinghorn and Western Kirkcaldy, questioned how locals would be affected by the tax, particularly during short stays within Fife, and those with visiting family members staying in paid accommodation.

“How do we ensure the public are fully aware of the political implications?” she asked. “I’d like a reassurance that any consultation captures the views of as many people as possible, and understand if there are any unintended consequences such as job losses in the tourism sector.”

A report from Carol Connolly, Executive Director of the Place Department, stated that possible benefits to the tax introduction are “a sustainable year-on-year source of revenue, an enhanced visitor offering, physical and cultural improvements to local areas, and increased funding opportunities for community-led tourism projects.”

However, the report also presents possible downsides to the introduction of the tax, including an increased administrative burden on the Council and accommodation providers.

Fiona Campbell, CEO of the Association of Scotland’s Self-Caterers, has warned Fife Council that they must “tread carefully” as tourism is a vital aspect of the local economy.

Campbell stated: “If taken forward, [the tax] needs to be right from the very outset and they [the Council] must be open about who will be charged — it won't just be foreign visitors but ordinary Scots staying in the area, including Fifers themselves.”

Campbell continued, cautioning that “rushing such an important decision will benefit no one, as seen with the significant unease with Edinburgh Council’s fast-tracked efforts which risks operational failure and reputational harm.”

Photo by University of St Andrews