Hotels in London, especially budget ones, are angry because of a new initiative of a Greater London Assembly (GLA) to impose ‘bed tax’ to all the 2,100 hotels in the capital of the UK. While that may be not a burden for luxury hotels in London, budget ones are particularly stressed as the new tax can add GBP3.40 to price of rooms per night.
GLA justifies such a decision by serious impact of numerous tourists to economy of the city. Millions of visitors every year increase the need in street cleaning, policing, transport and so on. They also mention Berlin as an example, where such a tax brings millions of euro every year. In London, an extra tax of 5% could bring to the budget as much as GBP240 million every year. Such a tax would add GBP3.40 a night to an average budget guestroom, which currently costs GBP68, but luxury hotels in the capital would suffer significantly. For example, the cheapest room at the 5-star Lanesborough hotel, which currently costs GBP640, would cost 32 pounds more.
Another idea is to add an extra tax for 4- and 5-star hotels only. The money from the tax could be spent to organize more attractions with free entry, as the government says. Naturally, the British Hospitality Association is against the new initiative and is sure higher price would discourage travellers from staying in London overnight. Moreover, hotels in the UK already have to deal with Tourism VAT twice higher than the average European tax.
London remains one of the most popular destinations for travellers. Last year, the city welcomed more than 20 million foreign guests. The average length of stay estimated 6 nights. Currently, there are 2,100 hotels in London that offer around 150,000 guestrooms. Extra 25,000 guestrooms are available through Airbnb. The idea of tourist tax appears from time to time. For example, Camden, one of the most popular destinations for tourists in London, is in the process of negotiations of adding a tax of GBP1 to fund street cleaning. The British city of Bath is also considering a similar tax.