 Welcome to the 18th meeting in 2023 at the local government housing and planning committee. I remind all members and witnesses to ensure that their devices are on silent and that all other notifications are turned off during the meeting. The first item on our agenda today is to decide whether to take items 3, 4 and 5 in private. Are members agreed? We're all agreed. Thank you. We now turn to agenda item 2, which is to take evidence from the Scottish Government bill team on the Visitor Levy Scotland Bill. We're joined this morning by Ben Haines, who's the bill manager, Robin Haines, who's the head of council tax and alternative tax policy, Phillip Duffy, who's the economic adviser, Munion Christie, who is a solicitor and also John Sinclair, who is also a solicitor. I welcome you all to the meeting. I now invite Ben to make a short opening statement before I open to questions from members. Thank you. Thank you, convener, and we are very grateful for the opportunity to be here today. We thought it would be helpful to the committee for us to begin with a very brief description of how the provisions in the bill would work in practice if a local authority was seeking to use the discretionary power provided by the bill. Firstly, a local authority would have to publicise an outline of its proposed Visitor Levy scheme. Section 12 of the bill requires that this outline sets out the objectives for the scheme and an assessment of the impact of the scheme. Schemes objectives must be related to developing, supporting or sustaining facilities or services that are substantially for or used by those visiting the scheme's area for leisure purposes. In assessing the impact of a Visitor Levy scheme, the local authority must cover the likely effects of the scheme on those living in the area and anyone else it believes will be affected by the scheme. A local authority must then consult on the scheme and it has to consult representatives of communities, any businesses in its area that are engaged in tourism and local tourism organisations. It is also required to consult anyone else it believes would be affected by its proposed scheme. The exact form and manner of that consultation is for the local authority itself to determine. Once the consultation is finished, a local authority is required to publicise a report. This report must summarise the consultation responses received and set out the local authority's decision on whether it is going to proceed with its proposed Visitor Levy. It must also set out the local authority's reasons for proceeding or not proceeding with introducing a Visitor Levy scheme. Any Visitor Levy scheme that is introduced must set out a number of elements in the bill but include the geographical areas in which the Visitor Levy would apply, the percentage rate to be applied, the date it would come into force and the times of year that it would apply. If, after the consultation, a local authority does decide to introduce a Visitor Levy scheme, it cannot come into force into at least 18 months after its decision. The reason for that is to give the local authority and accommodation providers time to put in place suitable systems to collect, remit and enforce a Visitor Levy. Once a Visitor Levy scheme has come into force, accommodation providers will need to make returns on the level of Visitor Levy collected, along with payments of the Visitor Levy, to the local authority every quarter. Under the bill, the returns and the payments themselves of Visitor Levy can be made by third parties such as a booking platform. There are also a number of enforcement powers that the local authority can use if necessary, reflecting common practice with other local taxes. Lastly, I should add that two or more local authorities can work together to create a Visitor Levy that applies in all or parts of both of their areas. I hope that that is helpful to the committee in briefly setting out the process that would have to be followed under the bill, and we are happy to go into any other areas in more detail. Thanks very much for that. That is very helpful to get that overview of the steps required. I think that we would like to start with a question which is just why is the legislation required and what is preventing councils from introducing such attacks just now? Is there anything in previous legislation that expressly forbids local authorities from raising their own income? Additionally, on top of that, why did the Scottish Government decide to introduce enabling legislation for potentially 32 local levies rather than introduce a national tourist tax? There are a few elements to that. There are not existing powers that local authority could use to introduce this measure. Bylaws do not work for this kind of thing, so it has to be an act that would give them the power. It is a piece of enabling legislation because the overriding drive behind it is to ffiscally empower local government to give them a new tool to use if they wish to do so in their own areas. There is also the question of competence, and it is very clear that the Scottish Parliament can create local tax to fund local authority expenditure. Robin, I do not understand anything that you want to add. No, the only other thing that I would add to that is that our engagement with local authorities suggests that it is very clear that some parts of the country for which a tourist tax might not be appropriate or considered appropriate, whereas there are other parts of the country and other specific local authorities that have made us aware that they are very keen and see a lot of benefit from being able to apply such a levy and use funds appropriately. Thanks very much for that. I will come back on the question around disclarification and why you chose to introduce potentially 32 local levies rather than just a national tourist tax. The overriding purpose is to give local authorities that tool rather than to create a new national tax. The bill seeks to put in place an appropriate national framework within which local authorities can introduce a visitor levy if, after consultation, it is the right thing in their own area. I would also be interested to know that some local authorities may see the bill as benefiting a select few. I think that you have already indicated that some may choose to use it and some not, with no obvious benefits to those councils who decide not to induce the levy. In the Scottish Government's analysis, how many local authorities are likely to introduce and benefit from a local visitor levy and why should other local authorities in their community support this legislation? I think the first thing I would say is under the forthcoming new deal for local government and the fiscal framework, certainly the Scottish Government is very open to looking at other proposals for other local taxes. It may be this is the first in the queue so to speak. There are around three or four local authorities that have expressed an interest in introducing a visitor levy and carried out work, potentially to preliminary work to introduce a levy, but clearly we are creating a power in the bill. The bill is seeking to create a power which, if Parliament agrees, will be on the statute book for potentially decades to come. Although there might not be a large number of local authorities at this point, there may be others in the future. The bill places certain requirements on what the funds raised can and cannot be used for. Within that, it partly answers your question. We know that there are some local authorities with a high level of tourism in their areas who see the establishment of a tourist levy as a means of raising funds to help better manage and provide better facilities where there are high visitor numbers with a high impact. There are other local authorities that we are aware of who are potentially seeing raising some additional funds through the levy as a means of further promoting their area as a destination and therefore increasing wider local tax take as a consequence of that and also generally raising standards and facilities in that area. That is a good point. The potential is there for more. One of the things that we are aware of is that you might have high numbers of day trippers, for example, staying in Edinburgh and travelling out but not staying overnight. Could it be the case that such areas continue to shoulder the cost of delivering and maintaining services used by tourists but would not receive any benefit from the legislation? Have you given any thought to that? You raised a good point and this was something that was covered in our 2019 consultation. The legislation is drawn around the levy applying to a particular event of staying overnight in accommodation that is paid for. The corollary of that is what event would happen for day trippers. Initially, one might think that a tour bus or some visitors might cross a local authority boundary but the practical impact of that for everyone else would be quite significant. For example, how do you distinguish a visitor from a local? Are there any kind of purposes you might want to exclude from it? You could end up with a really difficult situation if one was seeking to apply a charge and visitor levies. For example, I would have had to show my council tax bill at the top of the royal mile in order to walk back to this building. I think that there were some strong practical implications there as we began to think about this. I think that we are going to get into that in a bit more detail as we go on. I am now going to bring in Willie Coffey with a couple of questions. Thank you very much, convener, and good morning to everyone this morning. Ben, you mentioned the new deal just a moment ago there. I wonder if you could just set out a few more words for us about how the Government sees this particular bill in the context of new deal and perhaps other measures that might come along. The principle of enabling 32 localised solutions, is that something the Government sees coming in in the future for other parts or other provisions that might come in as part of the new deal? I am slightly constrained in what I can say because I am aware that the new deal for local government has not been signed or published yet, but certainly I think that there is any secret that the Scottish Government is keen to provide a new deal for local government, to fiskily and power local government, to look at a range of levers, open to looking at a range of levers that local authorities could use. Potentially the visitor levy is the first in a series of measures. It is the one that most policy development has been carried out and a formal consultation, but certainly I think that the new deal is like to include discussions around a process by which local government and Scottish Government could talk about potential future levies, potential new taxes that could be introduced, and certainly the thrust of that is to allow local authorities the flexibility to come up with solutions and tools that work in their area. Thank you very much for that very careful response. I wonder if I could maybe just ask a question on the response from the tourism sector. It has not been exactly positive to the proposal and quite a number of the comments that are coming in are basically about adding to business costs and so on and so forth. I wonder if you could offer some reflections and views on that, please. I would say that it has probably been a mixed bag and certainly I think that we have listened quite hard to the points that have been raised by industry. Certainly they were very much seeking to have the funding circumscribed in some way for certain purposes. I think that the bill takes that into account. There is also a lot of consultation that is required before a visitor levy is introduced and the requirement for impact, assessments of the impact to be carried out. We have listened and responded to the views of business on that. I think that it is a bit more nuanced than it sometimes comes across from the tourism organisations. I think that there are a range of views from the tourism industry out there. Some are not so keen on it, others are. We have always been clear that it will have cost impact on businesses, tourism businesses and accommodation providers if a visitor levy is introduced. We have sought to minimise that in every way that we can and it is something that we would expect local authorities to take into account. Philip, do you want to add anything on the work around business costs? As part of the exercise that we consulted with a number of businesses around these compliance challenges, potentially with a visitor levy, those were reflected in the business and regulatory impact assessment. We have captured and recognised that there are implementation costs and somewhat on-going costs to that collection process, but it has been, as you said, the aim of that consultation period is to minimise those where possible. If the bill does proceed and come in, will the Government look at that cost impact that businesses are concerned about at some future point? What if we review the effectiveness of the policy in the scheme? I think we'd be open to doing that, but I'm also very aware that these would be local authority schemes. There is a three-yearly review built into the bill itself, so I think we would want to tread a little bit carefully in terms of not looking over the shoulder of local authorities when they're making these decisions. It's also worth highlighting that Mr Arthur's lead minister for the bill on the day it was published wrote to Visit Scotland, Scottish Tourism Alliance and Cozzler in Vitingland to form an expert group task very specifically with looking at guidance and best practice for local authorities, wishing to take, wishing to use the discretionary part of the bill seeks to create. We very much see and very much imagine that being the forum for ensuring that a local authority using some of the compliance measures that are set out in the collection measures and set out in the bill approaches that with their eyes wide open and a thorough understanding of how those burdens can be minimised. I also think that expert group provides a forum for ensuring that there's an understanding amongst local authorities that the burden will be different for different sorts of accommodation providers. I mean the business regulatory impact assessment already distinguishes between different sizes of business and you can imagine perhaps so for a micro business whose booking sheet is a calendar by the phone sort of thing. The compliance might look like drawing another column on that whereas for other accommodation providers using accommodation management systems, the functionality already exists because these systems are sold overseas. So there's a range of things which I think is beneath the provisions of the bill which it would be really essential for local authorities and business to get together and understand and identify that it might be best implemented. Okay, thank you very much for that. I hope to come back in later on if I may. Thank you, convener. Yeah, thanks Willie. Yeah, it was good to get that detail about the extra column on the balance book because that's something that has come up to me being a Hanson Islands MSP with quite a lot of people that provide accommodation. Miles, you wanted to come in with questions. Thank you, convener. Good morning. Thank you for joining us today. I wanted to ask a couple of detailed questions. The first was in relation to where funding currently is being allocated and at the moment council tax and non-domestic rates are taken into account when general funding allocations by the Scottish Government are decided. As an Edinburgh MSP we receive one of the lowest levels of funding per head of population which the committee are aware of as I raise it every meeting, but I just wondered in terms of the legislation being proposed whether or not this will be considered in future calculations for the general revenue grant allocation and whether or not there's discussions going on in government about that. No, the intention is it's not taken into account when deciding on those. That's in part why the provisions of the bills say that the receipts raised from a local authority applying this levy should be... It's a delicate term in local government finance but effectively ring-fenced and separately segregated and accounted for separately so they will be not part of the wider local government funding arrangements. As we've heard already, I think the tourism sector, especially here in Edinburgh, given the significance it is to our economy, the Edinburgh festival especially, and what that might mean. Now I know that the Scottish Government have had a number of concerns put to them around the fact that VAT is applied to accommodation in the UK and is amongst the highest in Europe. The majority of EU companies operating tourist tax have notably lower rates of VAT on accommodation than the UK, so I just wondered how you'd responded to those concerns from the sector as well. I mean, I would say general taxation is a very complicated picture, you know, the VAT regime varies quite a lot. Philip, do you want to just pick up on some of the examples I think? Yeah, it's true that Scotland in the UK, 20 per cent VAT rate, it's one of the highest in Europe, but obviously it's just one of a number of basket of taxes that are paid by the industry. Everything that we'd, I guess, point out is that in other comparative countries, the point at which the turnover threshold for paying VAT is much lower, so I think in Spain, for example, there's no registration threshold, so you'll be paying, even the smallest businesses, we'll be paying VAT. That's not the case here. Those kind of comparisons, it's very hard to make generalisations. I mean, you could pick up one particular business and compare it between countries, but to make a generalisation is very difficult, but we do recognise that VAT is higher in Scotland than in other countries. VAT captures everybody on the chart. Do you want to come in? The Brewer also highlights research by others that recognises that tourism in the UK as a whole is not in price terms alone, especially competitive, but when the wider visitor offer is considered, it suddenly becomes a very attractive destination and is very high in the rankings. I also just, it may sound like a flippant aside for which I ask you to forgive me, but I do remember from my earlier economics lectures as an undergraduate that prices are the lowest form of competition as well, and that is reflected in that research that says that the UK as a visitor destination's competitiveness comes from the whole offer rather than just purely price. I think the main concern was around what percentage that would then add and where that comes in, given that councils will have that flexibility up to 100 per cent, which I think would then potentially make us uncompetitive, depending on where the councils decide to put that level. The consultation, which a few of you have mentioned already, was conducted, I believe, in 2019 before the pandemic and cost of living crisis. I just wondered what further consultation the Scottish Government intends to undertake. I know the Scottish Tourism Alliance have called for the committee to undertake some work on that, but just wondered, given we are operating a very different climate now post pandemic, whether or not the Scottish Government have revisited that consultation or intend to? So, I mean, since the bill, the bill was obviously work on visitor levy was paused in spring 2020 for obvious reasons. Since it came out of the deep freeze, as it were, we had a series of engagements with stakeholders, ministers have obviously been meeting relevant parties as well. In terms of specifically looking at the business, we went back to the businesses where we had conducted face-to-face interviews with a follow-up survey to see what had changed since they completed that. I just would slightly question that we are in a very different world now. Certainly, in terms of the tourism industry, it is bounced back very strongly and is now close to pre-pandemic levels. Philip, I don't know if you have got the relevant figures there. Yeah, I mean, in terms of our kind of inbound international visitors, we are seeing a strong recovery still slightly behind where we were in 2019. In terms of overall numbers, although the spenders seem to be up, it is still waiting for the picture for domestic visitors that those statistics are still to be compiled, but the early indication is that there is a recovery to where we were pre-pandemic. There are certainly challenges, but it does seem to be in a pretty robust position. Okay, thanks for that, and I hope that we have time to come up in later on some other points. Okay, thanks, Miles Annie. Thank you, convener. Good morning. In 2018, Cosla called for attacks on visitors and not on businesses. Given that the liable person in the bill is the owner of the premises, can the Government say that this is not a tax on business? So, just on the technical aspect, I think Robin is keen to come in. I mean, the first thing I think I would say is the bill is constructed in a way where the accommodation provider is the person who has to collect and remit the tax and liability focuses on them. Primarily asked a question about enforcement. If a local authority is much more realistic to if it has to take enforcement action to take that against, say, a hotel in Edinburgh, then it is an American tourist who owes £8 and has disappeared back to the USA. So, I would just say that on the technical side. Robin, I think you look like you're about to come. No, that's just going to endorse that exact point, Leslie. I suppose you could say it's a bit analogous to a retailer charging VAT in that if you or I were to buy a product on which VAT is charged, that's not a tax on business. We have to pay for it, but it's the compliance burden and we recognise that. We've already talked about it and committed it this morning. It does indeed fall upon the business, but the person that pays it will be the one consuming the product. Just another question from me. In the bill's business and regulatory impact assessment and policy memorandum, it discusses a range of other options which could be considered, for example, the Manchester business improvement district and the Slovenia example. I was just wondering whether you could describe the various other options that were considered and why the Government chose to pursue this tax? I'll just touch on the bid. So, one of the objectives of the bill is around ffiscally empowering local authorities. The bid doesn't do that. I mean, they have useful purposes and they have their place, but it doesn't really do that because effectively the bid is very much controlled by the businesses that are involved in it. The local authority collects that money, doesn't control how that money is used, is involved in that decision making, so it doesn't really meet that aspect, although I know there are bids in other places. In terms of the Slovenia example, I think I'll hand across to Philip. I know he's had a look at this. The tax in Slovenia functions much like the tax used in other parts of Europe where most of the tax is raised in the city and used to win the city budget, but there is an additional supplement that raises funds for their equivalent visitor agency. My understanding is that they are mainly funded by a block grant that is essentially funded by the Government, but there is a sort of top-up. It works very similar to, I guess, the visitor area that is being proposed here, but the way that funding is used for that is slightly different. That part of it is used to fund the visit to a national visitor agency. The percentage rate would be different for councils to decide, and the bill places no restrictions on the rate at which it would be. Has the Scottish Government done modelling of the behavioural impact of different percentage rates and at what point might the rate start to become as a talent? I think I'll hand across to Philip on that, because we have carried out quite a lot of work on that aspect. We have looked into potentially what the revenues could be raised from different rates of the visitor levy, ranging from one to seven per cent, and that's in the, if we could see that in the Bria. Yes, we have looked at what evidence there are for behavioural effects on price increases. I think that the first thing that I would say is that there is very limited Scotland-specific evidence of how visitors might respond to price increases. In the literature, you can find a range of estimates around price sensitivity, but there is a lot of context-specific factors. A lot of the literature will say that there is a beach resort destination in the Mediterranean where there is easily substitutable for the price differentiation between those destinations. Visitors might be more price sensitive, where there is a location that is more unique, where there is not a place that is substitutable. That is perhaps less of a factor. The other thing that we have looked at is in practical terms for cities in Europe that have introduced these taxes recently. They have not seen generally a negative impact on visitor demand, with the numbers of overnight visits increasing in the years after those taxes have been introduced. Clearly, the question of the interaction between what that rate is and the potential negative impact on visitor behaviour would have to be considered by each local authority as they assess the impact of the measures that they are considering. I think that I would echo Robin's point earlier that there are many things that attract people to come and visit Scotland and the UK more widely. Cost is probably not up there as one of the top factors. I think that plays into this point as well. I would point out that it plays into the Scottish Government's wider tourism strategy going forward. We have many unique offerings. People come to play golf at St Andrews, people come to go and see Edinburgh Castle, people come to go and put their toe in the ferry poles in the sky or try and spot the Loch Ness monster. None of those are substitutable experiences for which there are alternatives elsewhere. Just on the subject of the percentages again, the bill would also permit the percentage rate to be different from different purposes or different areas within the local authority area, but not for different types of accommodation. Can you outline some of the different purposes that councils might apply different rates for and why? I'll just pop it out to whoever I can answer. I think probably the easiest example is fringe performers. Edinburgh fringe performers, local authority Edinburgh might want to create a lower rate for themselves. Certainly, I know some local authorities have expressed in the past when they have particular events such as COP26. They would like the ability to be able to increase rates for accommodation booked for those purposes. There's a large degree of flexibility for local authorities within the bill. They can certainly make all sorts of adaptations and flexibilities that work for their particular circumstances. I think you've touched on one that they don't have under the bill, which is a different percentage rate for different accommodation types. I think it was just felt that was given all the other flexibilities that a local authority has, that was perhaps introducing a degree of complexity that wasn't necessary. I think it would be the feeling there's enough other tools to make adaptations without having to go down that route. Thanks for that. Sorry also, I think if you look at geographies, perhaps offering two examples, one might be the city of Edinburgh itself, comparing, for example, the Old Town with the wider city. There might be a justification there. Contrasting that with a very large local authority like Highland, which has a great diversity of visitor attractions within it and degree of attractiveness within it and the bill as drafted would give such a council an opportunity to manage and apply the leby as it's all fit within that very wide and diverse geography. In other countries that have different rates for different types of accommodation, there's a user where there's a flat rate and it reflects the quality of the accommodation and, in effect, having a percentage rate because these different quality of accommodation will obviously vary by price. The tax burden will vary without needing to set different rates for different types of accommodation. Thanks for that. I appreciate your responses. Just on the back of that, and Robin, you may have covered that in your response, but I'll just be interested to hear. If a council decides to apply levy in part of its area, but not in others, would there be a case for any revenue raised being spent in that same geographical area where the levy was raised? There could be. We're not prescriptive about that in the bill as drafted. A common theme to some of the things we've discussed has been this is very much about giving local authorities power and discretion. One could imagine if a revenue was to apply at a particular rate in a very small geography, it might be a bit questionable as to whether the ultimate sums raised were going to make a difference to that area. I think that the key point is that it's for local authorities to determine why we're not prescriptive about that. Right. It's something that they might draw out in a consultation. Thank you very much, convener. Good morning. We've talked about this proposal in the bill and the context of the new deal for local government, but of course there's also a new deal for business as well, running alongside that in business. You've mentioned the STA and others. I've got quite a lot of input that they've made into the proposals. I think that the first thing that I just wanted to explore a wee bit more was roundabout, and you've kind of mentioned this already. I don't want to use that word, but the ring fencing of the funds for specific uses in clearly STA and others is very keen that it seems to be directly used to support and benefit the visitor economy. Maybe I just want to unpick and explore a wee bit what the proposals are in that regard and what the options might be. Yes, certainly. I think that the bill tries to chart a middle way or does chart a middle way. There are some stakeholders who would very much like the money to be funneled into very specific tourism projects with ideally very little involvement from local authorities. There are other stakeholders who make an argument that this should just become for general local authority expenditure. Visitors have an impact on all sorts of services. It shouldn't be any restrictions on it whatsoever. I think that the bill takes a middle way of meaning this money has to be separately accounted for. It's transparent. It has to be set objectives for what the scheme will do. It has to be reported on every year and creates a sort of boundary around the use of that funding, which, as I've mentioned, is developing, supporting and sustaining facilities and services, which are substantially for or used by people visiting the area where the visitor levy applies. We feel that strikes the right balance between making sure that this money, which is raised from visitors, goes towards things that visitors use or for visitors without being overly prescriptive about exactly what that funding can be used for. Is there any example that you can give of the kind of things that may or may not be included in that definition? Sounds a great definition, but I suppose that the devil's in the detail and you get down to trying to figure out what exactly may or may not be included. Some examples that might be facilities where they currently don't exist in rural areas to accommodate visitors. There already is one there, but car parks around attractions like the fairy pools might be one example. Another very different example might be using funds to better promote a particular destination. I think that in both of those, the common strand is ultimately if a meaningful sum of money is raised and both of those things are done right, then it actually enhances the attractiveness of that area to visitors and therefore potentially is of benefit to tourism and hospitality businesses in that area. Absolutely, and also to increasing revenue by more visitors coming for the local authority and others as a consequence of that as well. Is there any thought that has been given to the proposals from the STA about the mechanism for deciding what money is spent on because we're talking about a local group in each authority that had the tax in place to make the decisions, at least oversee what the money was getting spent on between local authority and others, business etc being involved in that? I don't think we would probably want to define structures within the bill that have to be followed, but as Robin has mentioned, we are creating an expert group. Ministers have invited STA and COSLA to sit on that, which will be developing guidance and best practice. I think that we would anticipate that guidance and best practice would talk about the mechanisms that a local authority could put in place to decide on how that funding is used. Fundamentally, the important point to emphasise is that local authorities are or councils rather are democratically elected entities accountable to their electorate. If the decision is made within that council supported by the provisions in the bill and the best practice that this expert group is tasked with developing, then one could argue that that's a good thing for all. Just to go back to something you said earlier, if I understood you correctly, you said that the fact that the funds are ring-fenced is, to some extent, an advantage for local authorities because it means that money isn't washed into the general calculation around the block grant, so there are advantages to local authorities as well as to some businesses for that money being ring-fenced to some extent. I suppose that the corollary of what you've just described would be if revenues raised were to be part of general local authority funding, it would be fundamentally unfair that, for example, schooling in Edinburgh potentially could be better funded simply because there's a castle on a volcanic rock in the middle of the city compared to other parts of the country that don't have that attribute. So, on the last question, clearly one of the key issues with regard to the relationship with business and regulation in general is cumulative impact, so I don't know if there's been any consideration as to how this proposal would interact with everything else that's impacting business or has been proposed for business and what the mechanism is for assessing all of those different regulatory proposals that are in play at the moment. Certainly our colleagues who lead on new deal for business, we're quite engaged with them, they have that wider overview, so certainly they're aware of this work and some of the same people are involved in the new deal for business, as are familiar with the visitor levy. I think it would be those wider bodies around new deal for business that would look at cumulative impact. Certainly we play our part in making sure that they're aware of the work that we're undertaking. Sure, but that works in both directions because they could come back and say, you know what, there's six other things in business as well, therefore you need to have another look at this, so that's considered. Thank you. And Willie, you wanted to supplementary on that. Thanks, convener. It's on that point that I've been raised about the purpose to which the levy can be put and who decides. Let me give you an example. Say, Edinburgh City wanted to improve that wee section of the cobblestone road at the top of the royal mill, which is like driving on the moon. I'm sure that that would be welcomed by everybody, tourists and locals alike. I suppose that Edinburgh decided to repair that and use the visitor levy money for that. Would that be okay? Do they have to get permission to do that from the Government or to whom do they account for having done that? Tourists can use that section of the road just as much as we can. What would be the view of that, Ben? There's no requirement for local authority to get permission from the Scottish Government on what it uses the funding for. It has to obviously abide by the provisions in the bill. There may be a case for that. I'm certainly familiar with things like the North Coast 500, which has an impact on roads in that area. I think that would be something a local authority would have to consult on and include as part of its scheme. But it would be potentially something that was a facility and service that was used by visitors. Those kinds of things could potentially be funded. Robin, I don't know if you want to add. I don't know. I think the obverse of that would be much plainer in that there would be many streets within the capital which are far removed from the tourist landscape. I think it would be wholly legitimate to contest the use of any visitor levy in the maintenance of such streets. The Royal Mail might be an exception to that. Imagine the case being made, but I wouldn't wish to prejudge such decisions. I totally take the point that it's to the local authority to run a consultation on its design. You mentioned the North Coast 500. I wonder about hospitality issues in Highland, for example. In your work in developing the bill, did you come across any thinking around using some of the money for training people into the hospitality sector, which I think is much needed at the moment? I don't recall that coming up in the consultation. I'm just looking at my colleagues. Again, I think there could be a case made for that under the bill. It's not something that's been raised with us directly that I recall. Okay, but something that a local authority could look into in their consultation? Yes, certainly they could look into it in the consultation. Great. Thanks very much. Mark, you wanted to come in. Thanks, convener. I wanted to touch on the issue of cruise ship stays and that these have been omitted from the bill, although I know that the Government are considering that as further discussions part of the new deal. I just wanted to ask why specifically cruise ship stays have been omitted, given the cause that I called for it and the common place in other European cities? I think it's a very different animal from a hotel that is fixed in one local authority area and people are booking overnight accommodation. Obviously cruise ships are movable assets go to a variety of places and somebody who is going on a cruise ship, they are staying on the cruise ship, but they're also paying for being moved around to different places and visiting different locations. The taxable event is very different and I think the powers and the provisions that you need around that would be very different than the ones that we have in the bill. Robin? You made reference to this being considered in other fora and potentially under the new deal for local government there will be a fiscal framework for local government which will include measures about how an alternative new local tax might be assessed and we see this potentially being a candidate. To kind of expand on what Ben was saying about how this is a different thing, the taxable event is different, it's not as if we said now we're not doing that. We did engage with stakeholders and realised that it's not a reason for not doing it, but there are many questions which would need to be addressed and understood. For example, how should crew be treated if they come onshore? What would the taxable event be? Would it be disembarkation by passengers? Would it be the port authority that is responsible for collecting it or would it be the cruise ship operator? What about when cruise ships are moored offshore and passengers are attended onshore? How would the leby work? In introducing those I hope I'm demonstrating that it's not as if we've said no we're not doing that just as a blanket no it's just more a realisation. There's a lot to that, a lot that needs to be understood and because it is a different taxable event we see it as being a separate exercise to the one that is before the committee today. I can see the attraction in it because there are clearly some local authorities that would benefit to a much greater extent using a cruise ship levy than they ever will for an overnight stay on land. Barcelona have answered those questions, I appreciate those. There are different questions that you're talking about but other areas have answered them. Have there been any work with other areas that have introduced a similar levy? Like I see there are areas of the country that would benefit massively from it? The best answer I can give to that is we've indicated that we have given this some consideration but unfortunately one thing at a time I think given the resources available as I said I think this has strong potential to be possibly one of the earlier candidates for consideration under the fiscal framework arrangements for local government that I described but to have included them in this bill would probably have delayed the bill and required a whole separate consultation exercise by several years potentially not because it's all too difficult and all the rest of it just because this is a tax and there are reputational concerns for this Parliament and the Scottish Government for protecting their integrity as a taxing jurisdiction so we would want to ensure as officials who we've been advising ministers to ensure that everything that they did they did as correctly as possible in taking that legislation forward. Okay, thank you. Mr Sinclair was right in hearing from the community that you are causeless, slister, not sorry, I must have heard that at the start so I was going to see if there's a view from causer, that's fine. My second question in community I would declare an interest as a community of the cross party group on carers was around exemptions. Now within the bill there is the ability for local authorities to provide exemptions but also for national exemptions and I wonder why it wasn't considered appropriate to include an exemption at the outset for people travelling for hospital care or people travelling to provide care. I'm thinking particularly about parents who will be staying in hotels to be close to sick kids in hospitals why it wasn't appropriate to include that on the face of the bill? I think on the general question around exemptions the bill is quite carefully constructed to avoid various groups of people falling into the visitor levy so anybody who is using overnight accommodation as their main or usual place of residence won't be liable for the levy which obviously deals with people who are homeless or perhaps fleeing domestic abuse or refugees in the widest layperson's sense of that term. Exemptions are something that we expect the expert group to pick up and to produce guidance for local authorities on. We are quite aware that it will vary a lot. There'll be some local authorities where people travelling for medical treatment that may be a valid consideration or there'll be other local authorities where that isn't something that has to be taken into account. So we took the decision that it was best, minister's decision it was best for that not to be on the face of the bill but to be something that can be picked up in guidance with the backstop of regulations if necessary depending on how things turn out with guidance and what practice looks like in different local authorities. No, I think also part of that thinking was under that common heading of exemptions are things that would be of very specific concern to all carers and support for medical treatment being an example but there would be other exemptions that are very specific to that local authority area. I think Ben already mentioned there was we have received representations in the past debate exempting fringe performance for Edinburgh for example which is a completely different circumstance to the one you've described but nevertheless it comes under the heading of exemptions which is why well it not why but certainly informed minister's views as to why this is something which we felt was more appropriately dealt with at the local level. Okay, thank you. Mark, we've got a little bit of time in hand so Miles has some other questions. I think the exemptions question is quite an important one and you know deciding to exempt cruise ships from the legislation but then I think the detail of allowing councils then to decide of this is something we need to pursue so you know for example people who live in Edinburgh having family members coming to stay to see whether or not their council tax would allow them to then be exempt has that been looked at in any way of friends and family members coming they might be providing a caring situation as well on just wondering whether or not that had been looked at and I think you said earlier Mr Hayes that you hadn't necessarily looked at a definition of a tourist for the bill did I hear that right and what then that will lead to quite a lot of definitions being needed for any exemptions I think. So a couple of points on that. I don't think we did touch on that but yes we haven't defined tourist in the bill. I think both of your questions really point towards that the practicalities of an exemption of running an exemption how that might work could really be quite complicated and we're very aware that it will be local authorities who will be administering these schemes working with overnight accommodation providers in their area. The bill makes some provision around that such as around exemption vouchers but you know ministers really felt that it was important that those who are going to be involved in administering this so local authorities and overnight accommodation providers discussed in detail how exemptions might work at a practical level which will inform what exemptions are put in place because we are aware and the evidence shows the more complicated you make a scheme the more expensive it is to administer and the more difficult it is to administer so I think your question points towards the kind of slightly complex practical implications that you can get into with exemptions and that's why we really felt it was something that was best addressed by the industry and local government discussing together what might work at a practical level. But there's nothing in the building which would prevent a council wanting if they did like Edinburgh to say well if you have a family member coming to stay that can be an exemption if you book yourself for example and then booking system could say include that. I don't think there's anything I'm looking at my lawyers but I don't think there's anything in the bill that would would prevent a local authority from from doing that. I'm sure a lot of Edinburgh residents will be keen on that to be included but is there also to go back to what you said earlier it's a sad situation that a lot of hotels and guest houses are currently being used in Edinburgh for temporary accommodation or emergency accommodation that is then included in terms of not being captured under this tax am I right in saying that and and I think you touched upon the Ukrainian refugee situation and also people fleeing domestic abuse who might as an emergency be housed in hotels or guest houses. Yes that's right in that if somebody is using overnight accommodation as their place of residence or you know their main or usual place of residence then they're not liable for the levy we felt that was constructing it in that way was the best way of avoiding those those sort of groups that you've referred to. And would that include I'm just wondering what the legal definition though is because I know from casework people are from are moving around different hotels or guest houses depending on the availability especially during the festival when hotels basically kind of want to empty the hotels purely for tourism use. And so I wasn't sure if there's a legal definition of what that then would be your main emergency accommodation. John. We think the special usual residence is quite well understood there's probably also an implication no more than an implication in the bill read as a whole that it will be commercial transactions that will be taxed rather than non-commercial and most of the ones that Ben has mentioned as candidates for exemptions would not come under the commercial heading like housing Ukraine into them. Okay and you'd imagine the council in that case would very much want to have that defined before they take any of this forward given their responsibilities. And just finally I know this has been touched upon earlier for different periods you know obviously the Edinburgh festivals are very one-off but for some parts I used to work in the tourism industry in Persia for example that is very seasonal and do you expect or is it just in terms of exemptions and flexibility for winter months for example for this tax not necessary to then be applied to make sure that the highlands for example are not and discouraging people in quiet periods. I mean there's a couple of points there I mean obviously it's a percentage rate so naturally the level of visitor levy falls when a combination costs less and yes there's provisions in the bill to allow a visitor levy scheme to only apply between certain dates and that can be fairly broad as well in terms of you know running from Easter to the last Sunday in September so it doesn't have to be just specific dates it can also be times of the year. That's helpful thank you. I would just return to your previous question I think section 4 paragraph 1 is the bit that captures the it will apply where it's not where it's not somebody's usual place of residence so by definition if someone doesn't have another usual place of residence then they they would be by definition beyond the scope of the bill. That's helpful thank you. Okay thanks very much for that. I just wanted to pick up on something that you may Ben you may have said it in your opening remarks but you mentioned it when you were talking to Ivan that local authorities that the system would be reported on every year is that reported to the Scottish Government? No in line with the SIPFA accountancy rules the local authority has to publish the amount of money that's been collected the amount of money that's been used to administration every year and the performance of the scheme by reference to its objectives so it has to has to do that every every year. Okay that's great I just it sounds actually also very straightforward because that's one one of the other things that's been coming up for us in the conversations around the new deal is that onerous reporting that local authorities often end up having to do with national scheme so that sounds pretty straightforward I just wanted to check on it so thanks so much for coming in this morning that's been really helpful we got all our burning questions answered a lot more clarity on on the bill so really appreciate that and as we agreed that the start of the meeting today to take the next items in private that's the last public item for today and I now close the public part of the meeting thank you