 Felly, fel y cyfaint, wrth gwrs Eurom Llywodraeth Cymru yn y cymdeithasau cyd-fawr yn 2023, ac mae'n gweithio â unrhyw o'r Ystafell Cymru, Stephanie Callaghan. Rwy'n credu i ddweud ar ôl y cyfaint o'r cyfaint o'r ddweud o'r ddweud yn gweithio. The first item on our agenda today is to decide whether to take item 6 in private. Are members agreed? I'll just remind you that we previously agreed to take item 5 in private. I'd now like to invite Stephanie Callaghan MSP to declare any relevant interests. Thank you, convener. Just to let the committee know that I was previously an elected councillor at South Lanarkshire Council from 2016 to 2022, including being a member of the cabinet from 2017 to 2021. Given the nature of our session today, I'm going to invite Marie McNair. Thank you, convener. I'd like to declare that from 2003 to 2022, I was a local councillor in Western Barchonshire. The next item on our agenda today is to take evidence on the Visitor Levy Scotland Bill from two panels of witnesses. We're joined on our first panel in the room by Mark Rothall, who's the chief executive officer at Scottish Tourism Alliance, and Liam Thompson, who's the executive director at UK Hospitality Scotland, and Rob Dixon, who's the director of industry and destination development at Visit Scotland. I welcome our witnesses to the meeting. We'll try to direct our questions to specific witnesses where possible, but if you'd like to come in, please indicate to myself or the clerks. There's no need for you to manually turn your microphones as we'll do that automatically for you. I'd like to start. I'd be interested to hear your perspectives on tourist taxes across Europe. Obviously, they're common and don't seem to deter tourists. I'd be interested to hear your thoughts on that. Maybe I can start with Rob. Thank you, convener. Good morning, committee. Thanks for the opportunity to provide some evidence for you this morning. We are very clear that tourism levies and taxis across Europe have been long-standing in many countries. They have largely been positive, particularly in those countries where they form a more significant fund and are invested in the visitor economy. They've proven to be successful at improving the quality of what visitors experience of supporting businesses in seeking to play an important part in the visitor economy. There's not very much evidence of them impacting negatively on the consumer's decision making and choices about going to a particular destination. They've become quite commonplace and part of what visitors and tourists generally are familiar with. I think that we're following a reasonably well-trodden path that has been successful, and I think that that gives visitors Scotland grounds for confidence about the introduction of a levy and what a levy might achieve in Scotland for us. Good morning, everybody. It's a pleasure to be with you to give evidence. I mean, there are a lot of examples of visitor levies that are up and running across Europe. As Rob has said, there's no evidence to suggest that they're deterring visitors. I think that it's important to note that visitor levies exist for sometimes different reasons, and they're obviously applied in different ways, and the charging structures are all different as well. So, whilst they are common, they're all very different in their establishment and approach. A couple of other things that I want to highlight. I mean, they have been running and they are quite well-established, long-established. I mean, we're obviously looking at a situation where we could be introducing levies into perhaps less benign global economic circumstances, so we could perhaps see some challenges arising from there. I think that we also need to bear in mind price competitiveness as well. UK ranks very low in terms of price competitiveness. I know that you've heard this from other witnesses, but it is an important point. With 20 per cent fat plus additional costs for visitors, we are perhaps slightly disadvantaged compared to other destinations that have levies already. I think that those are important points to bear in mind, and I'm sure that any levy that is introduced, the industry can work with local authorities to make it a success, but we perhaps shouldn't look too much at models out there already. Thanks for much, Mark. Do you have anything to add? Yes, and good morning, everybody. Thank you, convener. I'm obviously not wanting to repeat what Leon and Rob have said, because I concur with what they've said, but the European Commission's report in 2017 reported on taxes, the impact of taxes on competitiveness of European tourism. It obviously concluded that a tourism-friendly tax regime could include reduced VAT rates, which obviously are not for this Parliament to address. It also cites examples of other countries where they've seen the benefit of that reduction in VAT. I guess just touching on the competitiveness edge that we see as a degree of concern and worry. It is a risk to introduce a tax of this type, particularly into our domestic market, where we have a high percentage of Scottish residents choosing to holiday in Scotland. We actively promote holidaying in your own doorstep. We've just reported a recent findings of 56 degree insight survey, sentiment survey, which was announced at our conference last week in the EICC. Of the 1,000 Scottish residents surveyed, 64 per cent of them said that they have absolutely had to start winding back on what they spend in the leisure tourism days out experience. I guess the concern and the watch out there is any further incremental charge to our core market at home may deter those individuals from choosing to stay overnight and spend. There are lots of... It's not apples for apples across the globe, but it is a proven product that does exist. We need to be mindful of how we apply it if it happens and goes ahead. Something that has been crossing my mind throughout the time that we've been taking this evidence is that Scotland has an incredible offer. It's got Edinburgh, for example, an incredible city. It's got the west coast, highland, mountains, Unique Anywhere, and it's got an incredible set of islands, many, many islands. When I hear the concerns that there would be an impact on people coming to Scotland, but we have such an incredible global offer that I wonder about the doubt in people's minds because so many people have Scotland and all of the aspects of it on their bucket list. I wonder what your thoughts are on that. We have an ambition, as you know, through a hope having seen our national tourism strategy Scotland Outlook 2030, which is a collective strategy from the industry, the government, agencies all together, 3,500 colleagues contributed to that strategy to make Scotland the world leader in 21st century tourism being responsible as well and having a sustainable future. We know that the destination is in high demand still. We are very fortunate to have witnessed a good return from our international visitors. It's like anything. If you're going to a destination, you genuinely want to go somewhere, you accept to pay what the going rate is to a point. Speaking to some of the inbound tour operators, currently the world is a much more competitive place when it comes to choosing destinations and other economies are less perhaps, you know, are still a bit fragile. We've got a very favourable exchange rate as well, which makes it attractive particularly for our US markets as well. We put in our submission that if a levy were to be introduced, there's still a tipping point as to how much people would be prepared to pay. Equally importantly, is that money that would be paid is also, if it's never ending, that's money that wouldn't be spent in the local economy and to the restaurants and pubs and the attractions. You come to a destination to do stuff. We've got lots to do, beautiful islands and everything else, but we also need to make sure that the rest of the economy is propped up as well. I'm going to move on to the next question. Rob, this one is specifically for you. It's around the fact that we've had representatives from accommodation providers talking about the fact that the bill gives the impression that Scotland has a problem with tourism and that there may be a risk of reputational damage. I'd be interested to hear what your thoughts are on that given Visit Scotland's main role is to market Scotland to the UK and the international tourists. We genuinely believe, and we've consistently said for a long time, that tourism is a force for good. It's good for the people who visit the country. It's good for the businesses that employ people and are able to make a profit from the work that they do. It can be and should be and must be good for the communities that host those visitors. Getting that balance right is critically important. Scotland has a good record of getting that right. Of course, it has some examples where it has not gone so well. If you look back to 2017-19, there have been some examples of that. We are very clearly of the view that the levy presents an opportunity to address that balance on a local authority by local authority basis and to tailor what the levy can do to ensure that balance is reached and sustained and developed even more strongly in parts of Scotland—you heard this in the evidence last week—who rely on the visitor economy as the fundamental and core part of their economic success. That is not, in some parts of Scotland, a marginal area of economic interest. That is the core of the economy and the opportunity to raise millions of pounds of money on a per annum basis and invest it in the future of that part of the economy, which sustains so much of the way of life in those areas that we see as being fundamentally important. Above all else, that's why we are positive about the opportunity that the levy presents, but we are mindful of needing to get it right. I'm sure we'll come on and we'll talk about some of the issues that we need to get right, but that central point about how you get the balance between visitors, business and community is fundamental to this and important. I'd like to invite Stephanie Callaghan to come in with questions. In January this year, the Scottish Tourism Alliance published its local visitor levy manifesto in advance of the bill. How do you feel that the bill measures up to that? And to what extent do you feel that the Scottish Government has taken on board the concerns that you have and what has the engagement and the consultation been like with the Scottish Government so far? Thank you for that question. Yes, I suppose for quite some time before Covid, the STA were pretty much against the levy as a whole, but our industry isn't blind to the fact that there are challenges out there in terms of financing and to Rob's point around how can we get investment into the sector to ensure that we are world-leading is an opportunity. We felt that we would get on the front foot and produce a manifesto with a set of recommendations, which we submitted in January, as you rightly say. In response to that levy, we were very grateful and very thankful that the reception from Scottish Government has been very positive. Minister Arthur has been extremely engaged with us right from the outset, as has Cabinet Secretary Neil Gray. Many of the asks and the recommendations that we have set out have been listened to and taken on. We are not all there yet, but at the same time we are very encouraged by the dialogue, not just with the ministers, but with their officials as well. They have engaged with our policy group and our council on a regular basis, and we welcome that. To Rob's point, our national tourism strategy talks about conditions for success. One of those conditions is right policy. It is about getting this right and getting the application of it right if it does go ahead. Rather be in the camp than on the outside throwing stones in to try to influence and make sure that together we get this absolutely right so that it becomes a force for good. My next question is from Mr Thomson. I am aware that the UK hospitality Scotland has consistently argued against the introduction of a levy. What alternative options should the Scottish Government be exploring to support communities to fund the improvements that are needed in tourist infrastructure to address the impacts of mass tourism? Do you have a view on, for example, the business improvement district model in Manchester? We have argued against the visitor levy. We have been consistent in that as much of the hospitality and tourism industry. As time has gone by and it has become clear that the levy has become more inevitable, we have been much more involved and engaged with the Scottish Government on what a successful levy would look like. As members of the Scottish Tourism Alliance, we fed into the manifesto document that we were talking about before. We are pragmatic about it. We can see that there are challenges that need to be addressed. We can see that there are cost pressures on local authorities. Our businesses are already paying large amounts in the form of business rates, so there is clearly nowhere to go with that. We cannot hypothecate that, which could potentially have been another option. Looking at the levy, we believe that, if we get it right, it can be delivered to the benefits of the local visitor economy, which will ultimately benefit accommodation providers and the wider hospitality sector. We are rolling our sleeves up. We are getting involved. The submission that I put into the committee's call for evidence made that clear. We still have a number of concerns about how it was run and how it was administered, but generally we are on board with looking at how we can play our part in making any levia a success. I believe that some of my colleagues will be picking up on some of those points. I want to pick up, Stephanie, that you asked about your thoughts on the business improvement district model in Manchester. I would be out of interest to hear your thoughts on that. That is very different to the model that is being proposed here, because that is business-led. It is an optional levy and it is cash at the point of exiting the hotel. It is still just a pound, so it is very different to what we are looking at here. It is estimated to subgenerate a few million pounds for Manchester and also for Liverpool. That money will be used by the businesses to improve the visitor experience, particularly around the business visitor side of things that are important. However, it is a model that is very different to the one that we are contemplating here in Scotland, but it has been a positive step for those businesses in Manchester. The optional payment on departure, is that optional for collecting or optional to give it? Optional to give it. I just want to emphasise that what has been developed in Manchester is a good business response to a desire of the businesses to do something in that area. They have used the business improvement district model to voluntarily arrive in that position. I would be a little bit nervous of comparing that construct to what we are talking about here, which is primary legislation offering the enabling opportunity to every local authority in Scotland for something that I think is much more substantial and long-term than a decision in the context of the business improvement district. It is not to criticise that. It is a very, very good model, but I think that we are talking about something that has not got immediate comparison and is a much longer-term proposition. Thanks for highlighting that. That is right. It is also about giving powers to local authorities and the choice to exercise it or not. Mark, you want to come in? Yes. As Robert said, they are two totally different things, but you will be aware that Sheila Gilmore from Visit Arran is on the next session. On Arran, they have a charitable donational trust, which they get a sizeable amount of money to be able to service some of the support networks on the island but nothing of the scale that could be leveraged from a levy. It was interesting to hear last week from Chris O'Brien, who is the chief executive of the Nevis range, that they have just introduced a voluntary contribution towards the greening of that area, so from an environmental sort of levy contribution. Again, a reasonable amount of money has been donated already. Whether that would be impacted if you had a visitor levy on top is another question, but examples of businesses doing what they can do in good ways do exist, but it is not the same as what we are talking about today. Certainly it would be good to keep an eye on those, because those sound like very good initiatives and it would be interesting to see if they are impacted. I would like to bring in Marie McNair. What your views are being an accommodation levy rather than a visitor levy? As many visitors as you know, such as daytrippers, campers and motor home drivers will not pay anything. Obviously you are aware that the Scottish Government has recently confirmed that it tends to amend the bill to include the cruise ships. Should the bill be amended to capture other visitors who do not pay for accommodation but clearly have impact on the areas that they visit, if so, how can that be done? I will pop it to Rob Furth. We are entering some of the complexity that exists in relation to the bill. I think that the principle of starting with accommodation providers is a good one. It is very transparent about the point at which the levy is applied. I think that that is a good solid basis for the levy. I think that it is well established in terms of the international markets and consumers will readily understand it. That being the foundation for the core legislation makes absolutely sense and we are supportive of that. You highlight a range of other types of accommodation and other types of visitor. In the fullness of time, it would be good to try and get the levy to apply, if appropriate, to those visitors. We are not yet convinced that there are necessarily the right answers available, particularly in respect of motor homes and crews. Whilst we welcome the work to try and include them, I am not sure that we should slow up the process that we have begun in order to capture those relatively by comparison small parts of the market. Crews, in particular, frequently the port is not necessarily the area where the visitors go to, so you have a disconnect between a rival point and where the visitor impact is. That may present some issues with self-evidently here. Rossiath is in Fife. Many of the visitors will come to Edinburgh or go to Persia or Stirling or whatever, so I think that there are some issues. That is a general point, but it is a specific point about crews. In respect of motor homes, we think that there are a set of challenges here about how you would apply the levy and collect the levy. Having worked in local government, I think that local government has a lot of existing powers to already charge for overnight stays of motor homes. We have seen a range of very good examples applied with the direction of visitor management, rather than applying a levy, where motor home users are quite happy to pay an overnight charge for good services, for good places to stay as examples in Fife of the work of, as the country said, trusts with the council there of collecting the levy. We have examples in the highlands of carparks being run by community groups and other trusts in order to raise it. I think that there may be existing legislation and existing opportunities that can address a large portion of the motor home piece. I am not going to say all of it, and I think that there is scope to pursue that, but our overriding view at present should be that the accommodation piece makes good sense, is logical and is applicable. There is probably further work on the other areas to do and time should be allowed for that to be achieved, rather than trying to press through with the changes in the context of the legislation that has been passed presently. There is logic in applying that first to accommodation. It is easy to identify, it is easy to capture the funds, and it is easy for that remittance to take place. I would say that this is a big step for Scotland as well. We probably do not really want to overload things by adding more to that. I think that this is very much a case of, if we are going to try, visit our levy, apply to accommodation, let us see how that goes, and then see if there is merit or any need to extend levies in other directions. On the piece about wild camping in motor homes, as Robert said, there are a number of complexities around that. There are solutions, which I am sure can be found over time, but I think that it would be helpful to focus on what we are trying to achieve with the bill as it stands at the moment, rather than trying to add more in there. I think that the cruise side of things, we need to understand a lot more about the cruise market, where the cruise market is going to go in the future, what kind of impact it will have on the decisions that the cruise operators would make. We have quite a lot in front of us already with the visitor levy on accommodation, and it is critical that we make a success of this before we move forward. One of the concerns of the industry is that the levy is a gateway to just introduce and keep introducing additional charges. If there is to be an extension of visitor levies or visitor taxes, there needs to be detailed conversation about what those changes would be and the impact that they would have. Trying to fit things into the bill does not provide the right time to have those conversations. VisitScotland chairs a campervan and motorhome working group as part of the wider work that we do with national agency partners and councils on visitor management. We are conducting research with motorhome and campervan users, and that work is on-going. That is the sort of work that needs to be coming to a conclusion and understanding where the options in respect of the levy might sit in respect of existing legislation and existing powers that local authorities have. That piece of work and that group is already focused on this. I should have said that in my original answer. I am picking up on what the guys have said. It is a very sensitive issue around campervan, particularly in the rural economy and islands. There has been a lot of discussion around it. I think that the opportunity here with the levy is to really improve the infrastructure that takes care of and provides the right space for campers to then park up and you collect a revenue stream through that form. There has been discussion around potentially collecting a levy at a point of hire, but again, if all the hire companies are set up in Glasgow and then the campervans head off to the highlands, there is obviously disproportionate peace. To the cruise point, it is absolutely critical that that is looked at very carefully and in isolation to that. We have seen what Amsterdam has done recently in terms of turning away or cruise ships turning to avoid going to that part of the globe. You cannot underestimate how important those cruise passengers are in terms of spending in the local economy. They do it differently and cruise Scotland would argue that 40 per cent of those who do disembark and have a good experience on the shore will return for a full-time land-based holiday. It needs to be a separate step, but it is understandable why that should be explored, but there are a lot of watch-outs to be considered first. I move on to my last question. Are there any accommodation providers currently covered by the bill that you consider should not be? Obviously, for example, the boating sector argues for the removal of recreational vessels and moorings from the scope of the bill, so pop it to yourself, Will. In terms of the accommodation providers on there, we are happy that it is covered. We have everybody on there that needs to be right now. For us, there was always the concern about having that level playing field, and we had particular concerns to make sure that the short-term let market was visible in part of that as well. From the UK hospitality Scotland side of things, we are content with the way that the accommodation providers are captured on there at the moment. We are also pleased that any new or emerging accommodation providers or trends can be captured in the legislation going forward so that the Government can be a fleet of foots on that. I have a question about that a little bit more, because I met somebody who sails around the islands yesterday. They are in a place where moorings will potentially be brought in, but they are not there yet, and they are very excited about that. Their boat does not have a cabin, so they sail to an island. The islands are up the west coast, and they moor the boat, and then they get out and they go and stay in a hotel. What do we do about that, where they get a double charge, because they would be charged for mooring the boat, but they are also charged for staying in a hotel? There are two separate issues. The mooring fee and the fact that you moor up on a pontoon, you are receiving a whole heap of other services. If you choose to maybe sleep on the boat on the mooring, it is, in effect, similar to the motor home type scenario. It is your own property, effectively. It is not a charter, but if you are choosing to go into any form of a fixed accommodation, then you should rightly pay that levy if that were to be applied in that location. It is an interesting one. It is your own vessel, and the motor home analogy is probably the closest you could get to it. Distinguishing the mooring fee, what you get by way of services from the marina itself is very different. Absolutely, it is very different. If you moor the boat, that is, from what I understand, included in the levy. People would be charged an accommodation levy, and on top of that they would be paying for all the other services as well. I am not asking necessarily for you to answer that, but I will come up with a solution on the hoof. It was interesting that, as you have pointed out earlier, once you get into the detail of the nuance situation, you can uncover the practices that people enjoy experiencing in Scotland in a particular way and how you handle a double charge. I am going to move on and bring in Pam Gosall. You mentioned earlier that there are more concerns around how the levy will be run. My questions are really around the process and how the money will be raised. Some of the witnesses referred to this as an accommodation tax. Others claimed that the companies would be acting as an unpaid tax collector for local authorities. Just as local authorities can recover their costs from the levy fund, should businesses be allowed to claim a percentage of the proceeds from tourist taxis to offset the costs of collecting, remitting and reporting levies? We are trying to look at this as being a partnership between local government and business. We have to bring the two sides together. If that thing stands at the moment, the levy will be paid by visitors, but there are some significant costs associated with managing and administering and then remitting the payments to local authorities. The Bria sets out some indication of what those costs would be in terms of pre-levy coming in and then on-going costs. If local authorities are going to look to recover their costs, then it is absolutely appropriate that businesses should have their costs fully repaid. Otherwise, we have a complete imbalance in the relationship. Earlier in the session, we have moved to a position in which businesses are pragmatic about the introduction of a levy. That is based on this being a partnership, looking at cost recovery for businesses and having a strong voice at the table in terms of how the levy moneys are spent. From the business perspective, being able to recover the funds is a pretty critical part of their activity around the levy. It is quite important for micro and small businesses, because the burden is quite heavy on them. They are not as large as the larger businesses with more people there and resources. Do you think that it is quite important that the micro and small businesses are looked after? I think that it is important that all businesses are looked after because there will be some significant costs for larger businesses as well. The time frames and changing of systems will cost all businesses money. Even larger businesses often have to delve much further back into the back office and the systems that they use that they may not own and have to pay fees for changes. I would say that all businesses should be able to recover their costs. Absolutely. On the micro business piece, many of these businesses have to employ accountants to do their books and stuff. This is another layer of time for somebody to do and work to do. Systems will change depending on the methodology that is used to collect the levy and have a whole heap of different variables. That comes at a cost. We are here in a partnership approach to this. I think that if you are going to bring the industry with you, we have committed to doing that. I think that the way that we have acted to date is to be part of this and to make it a force for good. It would not be a force for good if you suddenly start putting additional undue costs on to a business that puts it into a more difficult position financially. I want to just stand back and look at some of the parts of this from the moment and then come to the specific point about the impact of businesses. I said earlier that this is enabling legislation to establish the flexibility for local authorities to implement a levy if they so choose. The connection between those two parts, the legislation that the Parliament passes and the decision to enact a levy on a local basis, has to have in the space between them an incredibly important piece of work that local authorities undertake and on which they then formally consult the bill that I recommend statutory formal consultation by local authorities. I think that mechanism and that space in which local authorities will operate is fundamentally important to businesses in any given area being supportive of the proposition and understanding how the levy is going to operate, how it is going to be impacted in collecting it, how it is going to be supported in developing the systems and processes so that it can do that in as efficient and effective a way as Mark and Lee have pointed to and then also be supportive of the proposition in terms of how the levy is spent. I want to emphasise how fundamentally important that preparatory work by local authorities is in engaging with businesses, understanding business concerns and working with businesses in order to ensure that a levy, if it is implemented, operates in as frictionless a way as is possible for all parties, councils and the consumer and for businesses. That point is, for us of us of Scotland, very, very important indeed. I actually wanted to follow up there, Rob. You are part of the expert group that has been looking into this work. I was wondering if the expert group has had a bit of a discussion. I take your point that consultation is going to be a critical part and that we have to remember that it is not going to be from act to enactment of the levy, but there is going to be consultation if a local authority takes it forward. I wonder if the expert group had explored how the levy could be collected on behalf of the council. Do you have a discussion about that? Colleagues, on this side of me are on the expert group as well. Here we are. We have got the expert group. You have got a chunk of the expert group in front of you as well today. We had our third meeting yesterday. The answer to your question is that it is not in detail yet, but it is on the list of work that we are going to focus on and undertake. It is certainly an element of what we imagine the guidance will address once we are able to do that. We certainly see it as part of what we should be working on and what we will be working on. Rob, on exactly what you were saying there about how fundamental it is that local authorities are doing that consultation work and stuff, do you have any specific recommendations that you would like us to see the committee make about the bill? I might want to reflect on that and come back to you from a VisitScotland point of view specifically. At this point in time, I do not think that we have got anything that we would recommend needs adjustment in the bill. I would simply reinforce that we see the requirement for statutory consultation by a local authority prior to it making a final decision to implement the bill as being fundamentally important. Somebody who worked in local government for 20 years, that type of approach and engagement between council and stakeholders forming the evidence base on which elected members will make a local decision is critically important. The fundamentals are embedded correctly in the bill. I will discuss with colleagues whether there is anything that should be adjusted in there, but, as things stand, I think that the broad approach is correct and we are happy with it at present. One thing that I have been thinking about in listening to people is the idea that some local authorities have a tourism plan, a strategic plan. If a local authority decides to use the levy, should they then also be required to have a plan that the levy sits in so that everybody understands what is being used for it? Mark, you have been wanting to come in. Absolutely. We would say that this levy is there to enhance the tourism visitor experience. We would expect that destinations local authorities would have a plan. If they do not have a plan, we have a national strategy that clearly signposts and signals to what those areas of focus should be. From an industry's point of view, we are supportive of this because it does present the opportunity to enhance the local tourism visitor experience. Where we have been challenged with doing some of the stuff that we want to do, destination marketing organisations is a good example where investments could be made to support different types of activity. However, where there is no plan and there is a choice to go off and spend it elsewhere, we would have a big problem with that. Bring Leon and then Rob and then I will come back to Pam who has another question. Thank you, convener. Just to add into that, the consultation cannot be rushed. It is about making sure that we have all the right voices involved and making sure that the approach is absolutely correct as well. A key part of that is making an economic assessment of introducing the levy. It goes back to costs for local authorities, costs for business and then potential economic impacts. That is a key part of the consultation. Linking back to the connections with the local tourism strategies or the national tourism strategy, that is absolutely vital. Only by using those can you get to a proper conversation about the outcomes that you are trying to arrive at. It is not just about how much money do we want to raise. It is about how we are going to spend this money and the difference that it is going to make. The consultation should also contain some fairly detailed discussions around KPIs and the reporting mechanism so that everybody is clear on the levy and how it is going and the difference that it makes. It comes back to having businesses buy into the introduction of a levy and ensuring that communities are able to understand the difference that having a levy is making as well. I agree with what Mark McLean has said. I think that I would go further and link to the earlier comments that I made about how important the visitor economy is to the economy of many parts of Scotland. We have been working very hard and increasingly are able to point to regional economic strategies so beyond just individual local authority areas at the heart of which is consideration of the strength of the visitor economy and the role of the visitor economy plays within that regional economic strategy. We consider it important for the objectives of any visitor levy scheme to be aligned to that regional economic strategy and we would be strongly supportive of an individual council having additionally a local tourism strategy. There are a range of calculations available setting out the funds that may be raised through the levy and, depending on which set of numbers you look at, we are talking about tens of millions of pounds per annum on a rolling basis. It seems only right and proper that, considering how this investment might be managed, a council or a regional economic partnership are absolutely clear as to what they are seeking to achieve by way of outcomes, economic development outcomes in relation to the visitor economy in the medium and long term because decisions about a levy are, I am going to say, forever decisions. I realise that they are not entirely forever decisions, but they are for the long term. I think that it is absolutely essential that that regional economic strategy with a visitor economy approach rooted in it and a local tourism strategy is available to allow businesses and other partners to assess whether the investment proposition from the levy is actually going to deliver the economic development outcome that is achieving. I think that both Leo and Mark have made that point. I think that businesses would rightly be concerned if they thought that that levy was being raised without the necessary clarity on what economic development outcomes are going to be achieved from the investment of the levy. In answer to your question, we think that it is fundamentally important that that is available in advance of the detailed consideration of the levy. Mark, come in briefly and I will get on the count. I think that the other critical thing here is that it should be treated as supplementary income. It should not be at the expense of other budgets being slashed. This is the opportunity to grow the pot and not become a toilet tax or a trash tax, so it is there to be used for game-changing strategic investments. As Rob said, there is a lot of money that could be raised here, but it is why bringing that community with us is really important as well and having them engaged in that conversation. Sticking to the theme of how the money is raised and some of the concerns, you have heard that we had industry and, as witnesses, we have had councils. One of the areas of many that there was a disagreement on was whether the levy should be flat rate or percentage rate. The industry argued that flat rate would be easier to collect and it is important that the process has to be simplified. Both sets of witnesses talked about that, but we also heard from people from abroad last week in Europe that some places, some countries, are using both. To ask yourself the question around how important it would be to minimise basic burdens on businesses and what would be the easiest and simplest way to collect levy. I am going to go back to you, Leon, if that is okay. I think that we need it to be simple. That is the fundamental requirement of the levy. Now, percentage versus flat rate, in my submission to the committee, I said that the flat rate would be easier to administer. I think that there is broad consensus around that. What I would say is that whether it is a percentage or a flat rate, it needs to be proportionate and it needs to be fair. One of the concerns around having a percentage is that it very quickly ramps up the costs, particularly people who are staying for extended periods of time. So, what we really need to arrive at is something that is fair and affordable. Businesses can put in systems to manage either, but I think that they are on balance. There are merits for ease around a flat rate approach. I watched the evidence session last week with the European Tourism Association unpacking all the different approaches that are in place across Europe. I think that that highlights how complex that can become. If we are looking for a model for Scotland or local authorities within Scotland, it needs to be simple and understandable and easy to use and navigate by businesses, by local authorities and crucially by visitors, so that people understand what they need to pay. Just coming back to that, last week some of the councils spoke about that some of them wanted obviously a flat rate and some wanted percent. You can imagine what the businesses are thinking right now. Such burdens, whether it is micros more or large businesses to websites, accountants and everything, and different authorities. What is your view on that as well, that different authorities should be looking to basically look at that they should be setting it or should government? Within the bill we would like to make sure that there is a national approach, so that we do not have extreme divergence across local authorities. The difficulty that we have is that we run the risk of having a patchwork-quilt approach to what is going on, which becomes difficult for businesses that are operating across multiple local authority areas. Obviously, for visitors as well it is a challenge and most visitors will not even know which local authority they are in, so they will not understand immediately what they have to pay and so on. We really need to have it set in stone as to whether we are going for a percentage or whether it is going to be a flat rate. On the point that you were asking about whether there should be a cap in place, I would argue strongly that it would benefit the approach to having a cap in place. Again, whether it is a flat rate or a percentage, I think that if there are some parameters laid out in the bill, that would be incredibly helpful, because that is a lot of the nervousness around the introduction of a levy that businesses have that we could see this shoot up and eventually the sky is the limit. That is a scenario that we need to avoid. Obviously, if we have good dialogue and consultation with local authorities, we would hope that we would be able to avoid that and we would be able to always settle on a figure that everybody was comfortable with and that the market could bear. However, for the avoidance of doubt, it would be helpful to have some parameters set within the bill. I understand Leon's points. I think that they are well made. This is a quite complex point and quite a different point. Accommodation, which is the basis of the tax, is very price sensitive. You could go online and you could consider staying in Edinburgh tomorrow night and you would find a range of prices from quite low to quite high. It does not seem to us entirely right that you apply then a flat rate, regardless of your budget or your choice as to which end of that price piece you are at. Seasonally, of course, we are all very familiar with peak season prices and off peak season prices. On balance, we support percentage levy rather than flat rate. We think that that is more sensitive. We also think that it aligns to the approach in Scotland of trying to extend the season of catering and being more inclusive for all parts of the visitor economy, visitor market, so that people who have less money to spend are able to still afford to come to Scotland and have accommodation that is within their budget, but they contribute to that levy as well. The percentage would allow that to be adjusted naturally at the price point and at the pay point. On the final point, it is absolutely fundamental that it is one or the other nationally, but I think that it should be a mix. Then, as I indicated earlier, the consultation and the work that local government does is critical and important to work with local businesses to come to a conclusion as to actually if it is a percentage what that percentage is. Of course, that percentage can be adjusted over time. It might be in a time of economic uncertainty and pressure that a lower levy is appropriate. It might be as the economic cycles change that five years down the line a slightly higher levy is appropriate. Local government should be sensitive to those things and should work with businesses to try and find an agreed position as to what the levy in that local area should be. Final comment is that the enabling legislation is to allow local government the freedom to make decisions about the levy. I think that it is right that the freedom extends to the choice of what the percentage should be and the applicability of that levy in the local area. That seems to us to be part of that local decision making piece. It is a very emotive subject, as you can see. To Leon's point, the smaller the business you are, the easier it is to administer. When you look at the dynamic pricing models and how many different platforms people publish rates on, you have to show the all-inclusive rate on your site to the consumer. Again, if that model is factoring in percentage uplifts of varying types, the hostelling sector has a central reservation booking system for all hostels across Scotland. If you have variables across different authorities, that becomes quite a challenge to be able to model it. I think that it is also putting yourself in the shoes of the consumer as well. Without question, we absolutely take the view that there should be a maximum cap or amount of money that you could take from any one customer who is choosing to holiday or stay in Scotland, whether you are staying at the Balmoral Hotel or you are in a bed and breakfast. Going back to my earlier point, that money spent in a levy is also money that could be spent doing stuff and spending money in pubs restaurants, attractions, buying tickets for festivals, etc. I know Julia's behind me as well will be coming on later on. We talk about artists, etc. If they are going to stay long-term over the summer period. You have differing views across two of Scotland's largest cities. It is complex, but I get the point that, through a percentage model, you are likely to raise more money than you are on a fixed sum. If you look at it by the time that you have taken the bureaucracy out of it and all the administration and the transparency to consumer, a tour operator will contract business two years out, as will convention businesses, etc. They will also need to have absolute clarity on what that fee structure will be when they are actually contracting. There could be a lot of flip-flopping, but it also gives you that switch-on-switch-off opportunity to do it. The national cap, with the actual amount of money, is definitely the one thing that we would want. We have put in our earlier submission a parameter that, if you were to address the percentage, it was a percentage model of what that cap and percentage would be. The committee is grappling with the simplicity and transparency of a flat rate versus the probably the fairness of a percentage rate, but I just wanted to delve deeper into the concept of the percentage rate. When the percentage rate is applied purely to the accommodation provided, it is not applied to breakfast, spa and gym facilities, whether there is the potential for the avoidance of the levy for a hotel that has these extra services offered, essentially minimising the accommodation price on a bill and inflating the other services, but still maintaining parity on the price, whether that is a mechanism for avoidance for this levy, or at least minimising the levy, if we go down a percentage rate. Anyone has any views on that, Mark? Obviously, you could suddenly have 90lb breakfast, all of a sudden it could be very expensive. I am not saying the industry out there to deceive, but there are packaged products that are sold regularly. It goes back to the administration of that. We are also seeing an increasing number of room-only options as well, but you will have to strip out those variables according to all-inclusive rates for three-night stays to include festive packages, etc. However, it is based solely on the accommodation rate—that is our understanding—and that is the way that it should be for parity. However, it does bring additional leverage of additional finance admin. Would people view their breakfast as being more valuable than their accommodation? It might depend on where you stay, but you have raised a good point, which is interesting. Maybe just a short point on that. We understand the challenges that SMPs face when collecting the levy. I am going back to earlier points that were raised by Mount Nair. The basis for the tax is accommodation. All providers understand what the accommodation charge is, and therefore it is possible to charge the percentage levy on that accommodation charge. There are many, many ancillary things that are then added to a bill for a variety of different reasons, but I think that the fundamentals of that, if kept straightforward, are as easy as we can make it and being sympathetic to businesses in the challenge that they face. I do think that the percentage, but then accounts for the price sensitivity around accommodation and length of stay, etc. Just to close on that particular point, it will be a challenge for businesses to strip out packages and arrive at the final figure for accommodation. There also needs to be borne in mind that a lot of this information is commercially sensitive as well. I am aware that businesses will be required to share detailed information with local authorities. There might be some reluctance to put some of that information out there if it is likely to get into the hands of or be seen by competitors so that they can see how much the room rate is within a particular package of the neighbouring hotels. I think that that is something that we need to bear in mind and would need to be addressed at some point as well. Obviously, they have figured out how to do that in Europe and elsewhere, so, hopefully, we can figure that out in Scotland. Miles, you wanted to come in. Thank you, convener. Good morning to the panel. Thank you for joining us today. It follows on from some of the line of questioning that we have had with regards to what is an accommodation tax, not necessarily a visitor levy. What I wanted to look towards was exemptions in the scheme, because I think that some of the panels that we have had in previous weeks have very much agreed that there needs to be exemptions to the bill. So, I wanted to ask specifically how you think that could be administered by local authorities so that we capture these exemptions. Specifically, within the bill, there is the Government's put forward a possible voucher scheme, so I just wondered what your views were on that. Exemptions, yes. We have had a lot of discussion around this. Again, we view, I think, as fewer exemptions as possible. We will make it easier, but the absolute position from the industry is not for the industry to manage. It needs to be pushed back to the local authority for a number of reasons, not least GDPR, but people turning up at a desk with a voucher. If you are a small business and it is busy, or if you are a large business, you have a busy front desk to verify and be assured that that voucher is not a fraudulent voucher, etc., is putting a lot of unwanted pressure. Equally, I think that if you are in receipt of a voucher and you are given it because maybe you are on a benefit or something for a different reason, or you are there for a bereavement, it is also perhaps not great for that person to want to declare that at the desk of a hotel or otherwise will be challenged on it. It is, in our view, something that the local authority should administer, and it is a reclaim rather than actually dispersement at the hotel. I think that the process for any exemptions, and it is understandable why previous people who have been providing evidence to you have highlighted the opportunity of exemptions, but we think that the process for any exemptions needs to be straightforward, needs to be transparent and as consistent as possible. They all made the point about people travelling around Scotland, and that presents a challenge. It is fair to say as yet that we are unclear and therefore uncertain about quite how the exemption process will work to the satisfaction of the consumer without disbenefit to the business and without increasing the burden for councils. While there are clearly many reasons why exemptions might be applied in charging a levy, there needs to be more consideration given as to how we make an exemption process effective and actually generate the sort of outcome for the consumer that is desired. You asked, convener, earlier about the work of the expert group and we had some quite detailed discussion about this yesterday. I think that it is fair to say that it was inconclusive and there is more work to do in regard of the guidance end of this. I am making a specific comment this morning that I think that there may yet be more to do in respect of the legislation on this, because I think, as I said, it is unclear and uncertain about quite how we get this to work in the way that might be desirable. I absolutely agree with all of that. I mean, this is quite a challenging area. I think that the presumption should be that exemptions are kept to a minimum. I think that that is going to be in everybody's interests to do that. The exemptions that are already set out in the bill are fairly easy to manage, because for those groups of people they are likely to be part of contracts that the UK Government, the Scottish Government and the local government are likely to have with hotels or any other accommodation providers. They are easy to manage. When you start to extend it out, it becomes, as my colleagues have said, much more problematic for all the issues that Mark outlined. The key takeaway here is that accommodation businesses do not want to be having to make those decisions at the front desk, because that is going to be very problematic. It is also going down that route and perhaps leaves things open to fraud as well. If there is an exemption for people who are visiting because they are attending a funeral or they have a hospital appointment, we need to see some evidence, if they do not want to give evidence. That starts to become an issue for businesses, for my members and thinking about the financial penalties that are sitting behind the legislation that leaves businesses exposed. If they make a wrong decision, are they then liable to pay the levy themselves, pay the fines or whatever? From our point of view, the exemption should be minimal and should be administered by the local authority. Thank you for that. The complexity of this is that councils are not where you are booking your accommodation, so that evidence provision for why you would be eligible for exemptions is going to be difficult. I do not think that looking at this, there are very many examples around the world of where a good exemption scheme is already able to take off the shelf to apply to the bill. Our discussions yesterday around exemptions, we were looking at other countries and territories and the exemptions that they apply. They have minimised them and they have probably done that for this reason, because there is a real set of complexities around them. Do you know if industry has done any work around what percentage of people would be staying in accommodation within these exemption areas? It broadens out in terms of people who would want to see exempt quite wide. You have mentioned some of them in terms of people visiting individuals in hospital, potentially in prison, but there is a huge group of people. I noticed from your STA's submission around, for example, school trips and additional costs that would place on school trips coming to an area. Charities, medical professionals, military personnel—it is quite a wide group of people that we would exempt, should be exempt from paying this because they are working or they are undertaking charitable work. MSP is staying over in Edinburgh Monday to Thursday. I live here, so it's not a problem for me. In answer to your question, we haven't done any direct analysis of it, but we have a pretty good or we can access that information around school trips and stuff like that, absolutely. If we were to say how many people have actually stayed in your property because they've attended a local hospital appointment or otherwise, no, we don't have that depth. The potential for exemption also sits there with major events. If you are going off to win a major event or a convention, there is a way in which you could dangle a carrot, but that would again be a national decision or a local authority decision that would either underwrite it or otherwise. It would tend to be more contracted and managed by a central source rather than individual agents going off and doing their own thing. The scale of it is not there. Leon cited a couple of others. We know, I think, that Berlin is one city Milan. They exempt their residents of their own city staying in their own backyard. There are some groups that could be made exempt, and it would be simple. Where those contract arrangements exist with the hotel because it's a convention that's coming into a city or a town, that's easier because everybody can work together to manage that. Similarly with school trips, that could be managed fairly straightforwardly because it would be pretty obvious that it was a school trip and so on. It's if it widens out to a wider set of individuals who, when it's much harder to arrive at the evidence for issues of privacy, GDPR and so on, that's when it starts to become more complicated. Then there's the more practical things that's the unintended consequences you're on an island and your ferry gets cancelled and you're having to stay over. Are you exempt or not? Thanks for that. Just finally, do the witnesses have any views with regard to the 18-month leading time that we've had? Yes. I think that some of our answers, we think that the 18-months is probably appropriate. I talked in answer to Pam Cusill's question about the importance of the consultation period. I also think that there's significant importance in that leading period to do all the necessary engagement and work with businesses and within councils to ensure that the levy, when it's implemented, is successfully implemented. I think that that 18-month period feels appropriate from the point of decision making to the point of implementation. It's a period when there'll need to be close work with businesses to support them in getting arrangements in place. There'll be internal work that the council needs to do. There'll be discussion with a range of different stakeholders. That 18-month period feels appropriate. I realise that for those councils considering implementation of the levy immediately, that presents a little bit of a challenge, but I see that as a bit of a one-off problem at the start of having the levy. I think that as authorities come on stream later on in the process they'll be able to plan that in and I think that'll be more effective. Yes, absolutely. The 18-months, it sounds like a long time, but really it's not. I think that 18-months sits very well with the detail that we've been giving around the consultation, as Rob said. This will be a momentous decision for local authorities to take and to introduce it, so it's about making sure that we get it right. There's a communication with businesses, there's the time that businesses will need to get ready. Just by way of an example, when I was working with larger businesses around the introduction of the deposit return scheme, businesses were saying that they needed an absolute minimum of 12 months and that longer would be better. That helps them to get ready, helps them to keep their costs down as well, which I think is a crucial point in that too. Then there's obviously the communication piece with our visitors as well, and then there'll be people who've booked 18 months, two years ahead of time, who have paid but haven't been charged the levy, what do we do there. I think that 18-months not only feels right from a practical point of view, it's the right way to proceed. Marta, I wanted to come in. I'm just going to come back, and I can't not reference the short-term licensing scheme. This is about getting this right, and actually not having lots of hurdles that have needed to be overcome, so it's better regulation, it's good policy, but the time will go very quickly, and everybody has to be on the bus with it from the off. Thank you. Time is rapidly running out for us. The responses have been tremendous, but I would ask remaining members to ask questions to keep them brief, and if you all could keep your responses to the point, that would be fantastic. Everything that you have contributed has been tremendous, but I need to make sure that we don't go rat wildly over time, and with that I'd like to bring in Mark Griffin. Mark, in your organisation, have both flagged some concerns about the costings within the French memorandum and the Bria. I'm just wondering if you wanted to elaborate on those concerns and whether you think those documents accurately reflect the cost to your members. I'll go first. The Bria makes clear that it's running with indicative costs. We don't know the system that is going to be in operation. We don't know the requirements and the cost pressures that are going to be put on to businesses, so all that we've got at the moment is just a bit of an outline of what the costs might be. There were 20 businesses consulted as part of the Bria. It's quite a small sample, and there will be many other businesses out there who may have costs that will be far greater, many more things that they need to consider. I think that the Bria certainly didn't take into consideration the costs that businesses will face in terms of potentially paying commission on credit card transactions, for example, and they can range from 1.5 per cent up to 3.5 per cent, so that's something that's currently missing from within there. It's difficult with the Brias, and there's a lot of really good information in that Bria, but the costs are really just an indication of what businesses could be facing. That's why, for me and for UK hospitality Scotland, if a local authority wants to go ahead with introducing a levy, it's critical that it's part of the consultation process, a very clear economic determination of what the costs will be for businesses in that local authority area, as well as setting out very clearly what the costs to local authorities will be. Only then will elected members be able to make a call on whether they're going to gain anything stroke much from that, or are we just moving the same money around? I don't have much more to add on that, but we're also in a very different time as well. If you look at the wider costs and impacts on business at the moment as well, it is different. The sample set that's been consulted with is very narrow, so we would again support a much more detailed and in-depth dive to get it right. You've also flagged concerns around how the levy interacts with online travel agents and third-party booking sites, and whether you have any more clarity or information to provide about how it will work in practice. Those are issues that businesses will need to explore. We've highlighted that businesses may need to go back and renegotiate terms with the OTAs. We obviously have concerns about how the weather commission will be paid to OTAs, which will include the visitor levy as well. Those are all parts of the very detailed discussions that will need to happen when businesses are faced with preparing for managing a levy. The prices are varied across so many different platforms, so there are multiple different calculations and negotiations that have to be done. Equally, when you get down to it, if you're going to skin a cat what you're left with, is it actually going to have to make the desired impact? We have to look at the competitiveness piece in terms of that sensitive price point being published as an all-inclusive rate, inclusive of the actual levy charge and the VAT. I know in Europe not all member states have VAT applied to their modelling. I'm right saying that only five use the percentage model out of the 21 member states that do adopt a levy process. The others are all on a fixed fee, which again is a little more easier to put across the financial piece as well, but the complexity and the cost to businesses is yet not truly appreciated and understood. Finally, I'm sorry, another question for you. Leon, if UK hospitality had done any modelling on the impact of a levy on non-accommodation, so bars, restaurants and entertainment venues, did tourists come with a fixed pot of money that they have to spend on taking it out on one hand away costing those other non-accommodation businesses? That's a really great question and we don't know the answer to that because we don't know how consumers will respond. We know that we're in a cost-of-living crisis for our visitors. Visitors are looking to keep costs down, so any more that they spend on the accommodation will undoubtedly be less that they have to spend then in the local economy and the bars, pubs, restaurants and the obviously going to impact on members operating those businesses. That's something else that needs to be considered as part of the economic analysis. Is a levy going to add or is it going to take money out of the visitor economy? Just to say very quickly another set of results that we announced at our conference on it last week, which was again from survey research. In terms of occupancy levels, there were up, this is like for like, over 23, 22. Occupancy was up 7 per cent across the patch, and there's 220 different types of business types who applied. Turnover was up 12 per cent, profit was down 18 per cent and when you look at the pub sector, 340 pubs surveyed, their profitability went backwards by 36 per cent. The importance of having spend in those businesses is to keep them sustainable and grow and you do come to a destination to experience things. So again, restricting that amount of money that can be spent in the destination and in other parts of the economy is also something that has to be factored in because you want a destination that has stuff rather than an empty one. Thank you. Thanks Mark. Mark, can I just clarify on that pubs down by 36 per cent? Is that pubs directly connected to people coming to an area to spend or pubs in general? So this was a survey done by the Scottish Licence Trade Association where they surveyed 340 pubs and we looked at the profitability of the business because we all talk about, we hear a lot about strong performance in revenue and that's understandable because prices have gone up and rates have gone up, uncomfortably so in some parts, but they've needed to because the input costs are so significant. But despite that offset, because you've got energy and everything else, they're actually making less money, 36 per cent, less profit, 9 per cent of those surveyed said they are facing closure by the end of the year. And it's a multiplier of factors. It's not just one single activity. Obviously, workforce is tied into that. But unless you have a revenue stream and income and people spend, then you're not likely to be able to counter that input cost as well. I'm just trying to understand if it was directly to do with people going to stay in a place because what I understand- If your destination foot falls up, which it is, we know that turnover is up, which it is, but actually the profitability of the business has gone backwards by 36 per cent. Right. Because of time, I'm not going to labour the point, but what I understand is that a lot of people, because of Covid, got used to enjoying their drinking time at home with friends and that they don't go to pubs in general. So that's what I'm trying to understand, if the profit is down because it's across the board. Our visitor numbers, we've got strength and visitor numbers, so it's not that. It's actually people's spending ability as much as anything else as well. Okay. Thanks very much. I'm going to move on and bring in Pam Gozel. Thank you, convener. My question is around how the money is to be spent. I know early on the convener did touch on it with the tourism strategy. I last week raised a concern that councils are going through very challenging times at the moment, a lot of budget cuts. Do you think there's a concern around the fact that they might end up plugging this whole with the visitor levy, for example, especially when there's such a great area on the area that they'll spend on infrastructure, because you could end up spending money on roads and bins, and that works for the tourism side, obviously. You want it nice and clean and no potholes. However, that does go into the day-to-day work as well from the council, so what's your thoughts on that? I think there's a close relationship here between the visitor strategy point that we made earlier and then the spend proposals that are set out. I made very clear earlier on that we see the benefit of the levy as strengthening and developing and growing the visitor economy, and I think it follows that councils need to set out how the way they invest the money will strengthen the visitor economy. Frequently what's good for the visitor is also good for the resident and good for the business, and I made that point earlier. So, we wouldn't be against providing additional bus services to benefit visitors, and they might benefit residents as well. So, if you added to your service, if you strengthened your street-cleaning regime, if you improved infrastructure, those are all things that underpin and sustain the visitor economy to the benefit of residents as well, and that seems to me that that brings a benefit to the resident from the visitors that come to their location, and they have a three hundred and sixty-five benefit from that. What shouldn't be happening is the substitution of budgets with funds raised from the levy, so the council making a saving, substituting that money with the levy, and therefore it's just a replacement. We don't see that as strengthening and developing the visitor economy, we see that as simply a budget swap that wouldn't be acceptable. Final point, this needs to be set out in what the council's consultant on. They need to be clear about the purpose of the levy and what is going to be achieved in the levy, and I think that way business can be confident that there's a clear proposition in front of them as to what the gains from the levy are going to be, and then they can respond to that consultation process and be critical of it if they wish, or be supportive of it if they wish, and I think that will lead transparency in that space as well. I absolutely agree with everything that Rob's set out, and it all comes back to outcomes, KPIs and linking back into visitor strategies, but I think if we're going to go down the route of introducing a visitor levy, then I think local authorities and businesses need to be ambitious about what we're actually trying to achieve here, because there is a lot of money that is likely to be generated, and it's a missed opportunity if it just disappears into doing the same old, same old day, day after day thing. So we really need to be ambitious, we need to think about where we want to go, so again linking back into the strategies. Investing in culture and heritage, business events as well, business events haven't bounced back in quite the same way as leisure tourism has in terms of numbers certainly, so there's opportunities there perhaps to help some destinations in Scotland get ahead of their international competitors there as well. Infrastructure projects, public-private partnerships, to add to the offer that is here for visitors as well. Yes, visitors I'm sure would like to see graffiti cleaned off the walls in destinations, that's obviously important, and as Rob said that benefits visitors' perceptions of the destination and obviously the experience for residents as well. So they're not mutually exclusive, but I think let's be ambitious here and let's actually set some objectives, some outcomes, which everybody can sign up to. Ambitions are the key. I also co-chair the tourism and hospitality leadership group, which these gentlemen are on as well, and we talk about the top of the real strategic game changes of what can actually shift us to becoming that world leader in 21st century tourism. That will require investment of scale. The levy potentially provides a lot of that support, but as an example, I was in the south US last week, and I know Sarah's on the session next. We had their conference in a community facility, which was brand new. It supported the local community. It serviced from some tourist experience or visitor experience activity as well, multi-purpose. There was a great example of where the levy could invest in a similar type asset in the future, but it needs to be not toilet tax and trash tax, as I referred to earlier. I'm now going to bring in Willie Coffey. I wanted to ask you about whether the money raised locally should be spent in that area only. For example, say that it was a sky we were talking about and people are staying there, should the money raised through the levy be restricted and spent in that area, or should the local authority be allowed to spend that revenue wherever it chooses in the authority? I'm quite clear of you that it would be wrong to hypothecate the tax in that way. If it's a Highland Council tax, I don't think that the money should be hypothecated directly to any one single destination. I say that for two reasons. The first is that it relates to Mark's point about ambition. I would hope that any given location might have sufficient ambition that it would want more than the levy and that the council might be supportive of that. In any given period, Sky, to pick your example, might want significant sums of investment to deliver something new, something different, something better. Sky would then recognise that, actually, in Sutherland or Caithness in two or three years' time, it might have equal ambition. Hypothecating the money to individual destinations is detrimental to being ambitious. I also think that it might fail to address and recognise some of the pressures that come with growth in the visitor economy. I don't think that it's a good thing to do. I think that what is better is to set out quite clearly, as I said earlier, what the ambitions are of the investment and for destinations to be closely involved in the development of those tours and plans and strategies, so that they can articulate what they want to achieve and how they would want to use the levy. I agree with Rob's comments. If a local authority wishes to introduce the levy, then it's about bringing on other destinations in that local authority area. We've talked a little about pressures that can come with tourism. It works hard to encourage people to go to other locations to help to alleviate pressure in perhaps more popular areas just now. Coming back to strategy and ambition, I think that it's important that we share that across a local authority area. The way to do that is to make sure that there's funding flowing from any visitor levy. The Highland region is probably the more challenging region of the lot when it comes to how that money would be spent. It is emotive. Having been on Sky, I know that the Sky community very much would want that money to stay on Sky, but I think that Rob makes a very good point. Why not ask for more? It does go back to the consultation piece, the importance of that consultation and bringing people with you as well. The aim is to spread the tourism pound and try to make sure that the visitor experience off to Scotland as a whole is absolutely world-class. That will require working together strategically and over a timely basis. The question of the national parks came up in the discussion recently too. There's been using that, but how do we ensure that the national parks receive their fair share of the visitor levy? They can span over multiple authorities as we all know. How do we solve that particular problem? Rob will start with you again. There's a live discussion about that. I think that there is some further work started. If it was acceptable, I think that we might want to respond to the committee from a Visit Scotland point of view with some further thinking on this, because I think that my honest belief at the moment is that we need to do a little bit more thinking here. The two comments that I would make is that it's absolutely essential that councils thinking about the levy engage in early discussions with the national park. The whole basis of having a national park in the Parliament is that the Government is committed to at least one more national park before in the lifetime of this Parliament, so we might have three or even four in Scotland. The relationship there is critical. The second thing is that we think that there should also be early discussion with the other local authorities that form that national park area in order to discuss the levy proposals in the round for the national park. It seems wrong to us that the position of having a national park is not absolutely recognised in four square at the start of the discussion, so I think that there is a little bit of thinking and work to be done on this, so I will maybe come back, if possible, with some written evidence in gene course. Okay, that's great. Any view on that, Leon? Mark, will you leave that one? Well, as Rob said, it's critical that local authorities work together, and that's great that that's set out within the bill as well, encouraging local authorities to interact with one another if they're considering introducing a levy. That's just good advice, because if a local authority wants to introduce a levy, it would be good for them to talk to their neighbouring local authorities as well. We put in a previous submission and we think that they should receive a fair share, so we'll leave it at that. That's a really good diplomatic answer. Just a question from me. I invite you to look beyond the legislation and it's been in place and so on and so forth. How should we measure the positive impact of the legislation looking ahead? What should we be looking for? Let's start with Rob again, if that's okay. I think that it's entirely foreseeable that in 10 or 15 or 20 years' time we should be able to look back and recognise the difference that the investment that the visitor levy has made in our visitor economy, in all the benefits that a strong visitor economy brings, but that residents should look at the place in which they live and they should be pleased about the improvements that have been brought about because of the way that the levy was utilised in their local city town community. I think that if we get this right, and I think that it's perfectly possible to get it right, then we should look back on something that is genuinely successful and impactful on our local area because of the enabling nature of this legislation and the empowerment that we're giving to local authorities and local communities to make decisions about how it's used. I'll leave the matter of plaques to local decision making, I think. Leon, how should we evidence that it's successful? I think that it comes down to thriving destinations and thriving communities. Civic pride is a key part of that and I think that we'd probably like to see our communities more engaged in tourism as well because when the reasons we're sitting here talking about a visitor levy is that residents have perhaps fallen out of love with tourism and we need to sort of reintroduce them to all the good and the benefits that come with tourism and having visitors in our city. So I think that civic pride piece is critical but we have to have a flourishing economy as well which is delivering jobs from my piece in hospitality for people who are living and working in destinations. Final word, Mark? It's three. It's obviously the people who live in the communities. The businesses are sustainable, they thrive, they grow and the visitors keep coming back because I think that's important. You know we rank I think as the 14th most desirable destination to visit in the world. We're 140 out of 142 in terms of our price competitiveness. So if we can even with maybe a higher price point we can still ensure that we have a volume of visitor that comes through and they are happy to pay and to your point about signage I think there's absolutely another big part there that we it's important that we communicate how that visitor has contributed to Scotland so they feel part of it by making it very clear that your levy'sness has not gone down a plughole to empty a bin. It's actually helped us invest in doing this to create the destination that they've chosen to come and visit again. Okay, I'll do very much for that, Mark. Thanks, Willie. Stephanie, you've got a brief supplementary. Just a short supplement and I'll direct it yourself there, Rob. I'm just wondering about that collection of details. Is there not going to be a necessity to really do that and have something that's comparable across local authorities? So for example employment was mentioned increases in employment and tourism and also as well the volumes of visitors etc there as well, so that there can be that comparison and look at making improvements if there's bits that aren't working well in one authority better perhaps working well in another? Absolutely, we see the introduction of the levy and the data that it will generate as being very helpful in letting us understand the sort of thing that Mark was pointing to. I'm just giving us better, stronger, more empirical data on tourism in Scotland. It's surprising how often we don't have the data that we think we would like. Miles Brown has asked questions about exemptions. We really don't have data that's available on this and there's an example of where a collection of good, hard data will aid future decision making, I think, very helpfully. Thanks for that. That concludes our questions. I very much appreciate you coming to join us this morning. I think it's been a very useful discussion. We're seeing even more of the picture and unpacking that complexity that you described at the beginning. So thanks for joining us and I now suspend the meeting to allow for a change over witnesses. On our second panel this morning, we're joined in the room by Julia More, who's the director of festivals Edinburgh, Gary Curley, who's the executive chair at Sky Connect, and Donald Elmsley, who's the chair of Edinburgh Tourism Action Group, and we're joined online by Cathy Earnshaw, who's the destination strategy manager at Venture North Cooperative Limited, Sheila Gilmour, who's the chief executive at Visit Arran and the Arran Trust, and Sarah McLean, who's the chief executive at Outer Hebrides Tourism. I welcome our witnesses to the meeting and we'll try to direct our questions to specific witnesses where possible, but if you'd like to come in, please indicate to myself or the clerks. For those of you online, please put an R in the chat function. I just also want to say we're quite tight in time, it's quite a big panel, so really only come in if it's like there's a burning thing that has not been, we've not heard from somebody else, but we will try also to start with different people so that we're sharing the contributions and the contribution in the conversation. So I've got some general questions initially. I'd be interested to hear about the importance of tourism for your local economies and the challenges in terms of ensuring local services and infrastructure meet the needs of residents and visitors alike and how visitors' numbers and spend this year has compared to pre-Covid, the pre-Covid period now. Having just said what I said, I'm probably going to end up hearing from all of you, but in this case. So maybe let's start online. Maybe Cathy, we can start with you. Hello, thank you. What are we representing the far north of Scotland in cave nests in Sutherland? Overall, we don't have final figures at the moment, but we've definitely seen numbers come back in terms of recovery. I think, like Mark said earlier on, but net profitability is not as people would hope. Obviously, the various cost of living and energy crisis and cost affecting a lot of our businesses in the areas is very important across caves nests in Sutherland. Up to about 16 per cent of our economy for jobs and accommodation and the service industry there, we depend on that, as well as other ones, but about 16 per cent across caves nests in Sutherland. Slightly more than the rest of the Highland area in terms of dependency on the tourism and hospitality. So we also, I would say, have clear differences in terms of our geographical spread, i.e. more visitors in the north west of Sutherland compared to central and east coast. So it's very important that we take that in view in terms of a visitor levy for the future. Obviously, representing the Isle of Skye, as you know, Skye is a very popular tourist destination, second most popular in Scotland. In terms of the visitor economy, it produces an economic output of about £260 million a year on the last bit of research from the Moffitt Centre that we did in 2019. It's hugely significant to the residents and the businesses on Skye. It's the main economic driver there. In terms of visitor numbers, we've seen a return to pre-pandemic levels. Certainly that's true, but again, to echo the point that that hasn't necessarily translated into extra profitability or success in the businesses, a lot of businesses are actually really struggling at the moment, despite the numbers making it sound like everything's great. So profits are being heavily squeezed, so reinvestment has been very difficult for a lot of these businesses. Again, all the same challenges. If you've got a business that's turning over £260 million a year, you would be investing some of that back into that business to keep it alive and to improve it and to enhance it and to preserve it. That's one of the issues on a place like Skye. It needs significant reinvestment in order to maintain that, to preserve it and to enhance it for residents and visitors. I'm going to tuck in another question rather than going around everyone with a second question. So I'll start it with you and then Kathy will come back and pick it up with you, which is interesting to hear what your thoughts are, positive or negative, around a levy. Yeah, so what we did at Skye Connect is we actually did a survey, sent it out to a thousand businesses and individuals across Skye. We had 170 responses to that survey, so I can represent that first of all because we share the views of what was found from that survey. So there was some angst about the idea of introducing a visitor levy. 60 per cent were against the idea. However, that was driven by things like impact on non-vac registered businesses. I think there's a lot of questions around what that will mean if people are taking over the vat threshold, things like that. That also led to some businesses 64 per cent saying that they would actually take fewer bookings because of that issue. One of the things that did come out really strongly in that survey. I know that we touched on some of the issues earlier about where funds should be reinvested and how that should be split, etc. However, 90 per cent of the respondents believe that revenue generated in the area should be reinvested in the area. So there's a huge public opinion about the idea that if you're generating the money, then really it should be reinvested in the local area. However, it is understandable that if you're going to be ambitious, then there's some national strategic things that perhaps you should consider. However, with the pressures on the infrastructure each year, it has to be waited in order to provide preservation and to improve the infrastructure. If we look at the other question on what accommodations are going to charge the levy, on places like Skye and other areas around the Highlands, we've got a lot of camper vans that come. That was a big issue that came up in the survey as well. 85 per cent of respondents believed that camper vans motor homes should also contribute because there's a conception that in terms of the environmental impacts and the waste and everything else that these visitors produce more waste and potentially spend less money on the island as well. So there's lots of things that have come out of that survey but it's all in the response that we put forward. Brilliant. Thank you very much. It's very helpful. I'm going to come to Sheila online and just as a memory jog, my questions were, how important is tourism to your local area? How have you done in terms of recovering from Covid-19 and your thoughts in general positive or negative on the levy? If you could stick with that because there are other questions that we'll get much more into the detail. Thanks. Of course, thank you very much and thank you for inviting me along. It's been a very interesting session. Tourism is absolutely vital to Ireland's economy. It's the mainstay of our island economy. Currently, we suggest that an actual fact that the economic impact is higher than it was in 2019, so that's pre-Covid however cost of risen. So the profit margins have lessened, as I think you heard in an earlier session. So it's not the rosy picture that is printed, if you like. There's a lot more to it. If I tell you that we have a population of about four and a half thousand, we're just waiting on the final figures coming in for that, but four and a half thousand and over a thousand about 1,500 are employed directly in tourism. I think that gives you an indication of how important tourism is for the economy. Our concerns, I guess, around our tourism visitor levy are really that we've got quite a lot of challenges on going, which are well documented. Being a Scottish island and the ferry service as it is at the moment, it's all quite challenging. So we feel that's just another obstacle in our way. Businesses would also just let sky concerned about the vat threshold and where that's going to position businesses. We don't have any other access to Arran. We don't have any airports or anything. We only have the ferry and that is our lifeline service. So there's a lot of concern around the majority of our visitors come from the central belt of Scotland. Would that be seen as a double tax? Would they consider coming here? Would they why come to Arran if you go to the Lake District and get the same similar geography and enjoy that kind of experience, just the same? So there's a whole load of concern and I think there needs to be a bit more clarity around the exemptions as well because we do have people commuting from the island and people who commute to the island and there's a lot of other things in there I could go into in which are all in our paper and I won't go into them in too much detail just now. But yeah, there's more questions I feel need to be addressed. Thanks very much for that Sheila and we've definitely got more questions for this session. Julia, can I come to you again with the same three? Of course. I might leave the question of the importance to the visitor economy to my colleague Donald who we work very closely with. If that's all right Donald. Just at the interest of time. So in terms of the significance of Edinburgh's festivals to residents and visitors alike and how we've been doing coming back from Covid, residents are obviously at the heart of responsible tourism and they are the largest biggest segment of audiences in Edinburgh's festivals so about a third of the audiences come from the city. So coming back from Covid we really want to be making sure that we are building back in a way that works for those residents, the visitors that come from the UK and further away and for the city spatially and reinvestment is really crucial to that. We've just published an economic impact study of the first year back at scale since Covid and we've shown that with about 70 per cent of the visitors in total volume numbers that we had before the pandemic we're achieving at least the same amount of additional economic value and more when you look at the economic value that's delivered for cities. However the accommodation providers in particular and other hospitality businesses are where that money is largely flowing. It's not coming back to the city infrastructure it's not coming back to those who make the festivals happen and so we do see this levy as an important way of being able to kind of reinvest in a sustainable future visitor economy. Obviously we want to see culture and heritage and festivals be at the very heart of that because it does provide so many year-round benefits to people in the city as well as to our visitors and it provides the very sort of authentic experience that future visitors, responsible visitors want. You've got a very Harry Potter vibe obviously going on in the city but you've also got really contemporary cutting-edge culture and that's a very powerful offer that we don't have in many other places. Thanks very much. Donald, I'll come to you. Thank you very much. I won't surprise anyone for me to say that tourism in Edinburgh is a significant driver of the economic success of Edinburgh. In the latest, the statistics before Covid it represented, Edinburgh represented about 26% of all Scottish visitor numbers and up to 66% of all international visitors and pre-Covid it was about £4 billion a year was the economic contribution employing 30,000 people a year directly plus all the supply chain employment. So it's a very very big part of the economic success that we see Edinburgh and if you walk round Edinburgh you'll see many cranes and building sites and most of them are building hotels or repurposing buildings back into some kind of tourist business so that all of that is very very positive and exciting. In terms of the recovery I think we've recovered very well mainly at the success of the North American tourist market but as you've heard previously numbers are up revenues up but I suspect that the profitability of some of the businesses are under pressure because of the cost of doing that business. Turning to our view on the on the introduction of a levy again you'll know that Edinburgh has been quite far advanced and it's thinking and development of this. The organisation that I represented at ETAG has been I think has been discussing this for about 20 years on and off and I think where we've got to is understanding that if this legislation is enacted and enables Edinburgh to introduce a scheme then we want to be involved we want to make sure that the scheme is a success and as this could raise significant amounts of money in Edinburgh for the delivery of our tourism strategy that goes out to 2030 we've got a very policy driven tourism strategy that looks at people place partnership reputation and sustainability and the levy as Julia has said will help us to deliver a lot of these strategies and a lot of the the strategic goals that we've set out in our tourism strategy to deliver for the visitor economy and the key point of all of that is that it's not about it's about managing growth for the benefit of the city its residents and its businesses and its visitors because we understand that increasing numbers does bring concerns and impact on the city and this levy will be very important to allow the visitor economy to mitigate some of these challenges. Thank you very much for that. Sarah, can I come to you? Good morning. I would echo what's already been said around the importance of tourism to our community. I believe that at the last time there was an economic impact assessment done in any depth that was proven to be the biggest private sector employer across the island and contributes significantly to communities especially some of the more rural and fragile areas in particular are reliant on tourism and visitor footfall. We've recovered fairly well all things considered since pre-pandemic figures and certainly interest in the islands has bounced back. We've had significant challenges around ferry travel which has had an impact on the industry specifically in US we've ended up with quite a divided picture of both north and south in that we have had a lot of benefit over the last year from increasing cruise traffic to Stornway and around Lewis and Harris and the picture for UST is a lot more challenging and we know we have already lost businesses in UST due to constraints on visitors so a fairly mixed picture and I would say generally more fluid than it was perhaps a little bit less predictable than it was pre-pandemic. Again profitability definitely down businesses are finding things more challenging but I think overall because of the challenges around finance and flow of finances within the sector overall then there is a broad support for some form of levy it's about getting it right in terms of how it's shaped I think and how it's applied and making sure that it's fit for purpose and who it captures so yes we're broadly on board but interested to see how how we can make it work effectively. Thanks very much and Kathy if I can pop back to you just to pick up the question about the levy. Yes thank you for that. We like Sky as well we did a couple of surveys actually one directed at our venture north members which are clearly more business members and also a general public one while we were out and about at various shows all online I have to say overall for both sets of our results the views were marginal so from our venture north members and tourism businesses it was marginally 53% not in favour however slightly stronger in terms of in favour for it through you know more open public consultation but yet again only at 59%. Some of the key concerns whether the people were positive or negative was actually around the management of the funds where they to come into place and that more strategic view concerns over the highland region how that would be done and so definitely in our responses we have advocated very strongly in terms of a cross sectional private public sector management committee if the levy was to go ahead so that we get a broad view right across the highlands that specifically I think you won't be surprised in the rural north the same as out in our you know the islands there to have a stronger voice in the highland region because it covers such a vast area. So yeah very marginal very key that it was kept at low cost with minimal impact to businesses but most importantly around our communities and our residents here it is about that balance between visitors and residents and very much here at venture north we've done a lot of community consultations working with a lot of directly with anchor organisations in terms of the impact on the visitor economy the impact on the places that we live so that's most important I think going forward that there is that broad strategic view this these funds could be very very significant and I think our key message is that we take those big ambitious views but we also include all the areas in terms of that planning and so I think not to be I appreciate Gary on sky in terms of the impact of tourism there but I would say in our area we feel it should not necessarily be within one destination where the funds are raised many of our communities we could be the the pathway to the Orkney islands which are extremely popular and also to people travelling the NC500 route going to sky as well so there are impacts on communities of travelling through destinations and I think as well if you look at the long-term picture you've got to say well do we try and redirect people to different areas or different destinations and if you can take that broader highland view then you can channel any potential infrastructure funds in the future to encourage visitors to these areas who perhaps have capacity for visitors as well as improving it for residents in the areas that are already impacted by overtourism thank you very much for that response very good to hear that perspective now going to bring in Marie McNair thank you convener and good morning panel i've already asked this question in the earlier panel but I was looking to get your views on this being an accommodation levy rather than a visitor's levy as you know many of the visitors you've probably heard such as day trippers wild campers and some motorhome visitors will pay nothing what are your views on whether the bill could or should be amended to capture visitors who do not pay accommodation but clearly have an impact in the areas that they visit and I'll pop it to Gary first yeah i mean i think it's a good question and i think that you know if you consider visitors when they're visiting destinations around the country you know who are then contributing through the visitor levy for sort of environmental protection or enhancement or infrastructure improvement you know i don't think that that stops at just people who use accommodation i think that you know others would be quite happy to pay a levy and i think that you do need to consider that you know perhaps even the people who use hotel accommodation and bnb accommodations may not produce as much waste to say other types of accommodation which are not included in the levy and so i think you know from our sort of local research and discussions that we've had you know there would be sort of broader support for a wider levy with other accommodations potentially considered donald thank you this is an area that perhaps doesn't impact too heavily on edinburgh in that the motor homes and camping perhaps is not a significant part of edinburgh's visitor economy but our position has always been that any introduction of the levy the legislation should make it clear which type of accommodation is going to have to raise that levy where possible it should be a level playing field i don't think it's insurmountable that particularly mobile homes could could be charged a levy at the point of where they're being rented and i think or gps tracking some kind of technology could be involved in that i think cruise ships in edinburgh poses a much more complex and complicated discussion and it's one that perhaps needs a lot of thought as the bill goes through parliament about how a levy might be charged to cruise ships and again it's about consultation with port ports and and how that might be raised if it is to be raised thank you donald anyone online before we go to my next question she has indicated she wants to come in you're on you say i think you hear me now yes just to play that um there is an issue around it all being about accommodation as well we've done quite a lot of research on this you know when we do your visitor survey or exit poll it's all about roads that's that's the big thing apart from ferries which is another another saga but real roads and and and and that's the biggest infrastructural thing that people say that wish was improved and to be perfectly honest with you you know you're penalising the tourism industry and accommodation providers would be then be looking to try and generate income that would be used to fix potholes on a road that is used by absolutely everybody so it's it's a really difficult thing to kind of say well it's all down to its accommodation providers because every business uses the road you know at the end of the day tourism is everyone's business so everybody's making use of of the infrastructure and yet it seems to only be the accommodation providers that are being asked to implement something you know we've got a lot of smaller businesses here a lot of bed and breakfast and self catering units i've just gone through the short term lets and i don't want to churn over all that but i mean you know they've already been through the mill with all that and now we're asking them to do even more and we've got survey out just now by doing it how many of our businesses have actually decided to stop as a result of the the short term let licensing and also how many of those properties are actually going to go back in to the general housing market and at the moment it's looking like very very little so there is an impact of just being accommodation we all have a lot of second homes here so they're still coming they're still you know using all the facilities but they're not actually paying for accommodation because they have their own accommodation so it is it is a really challenging one to to address i think thanks for your views to Sheila you would like to come here please with us very much um yes i can the strongest responses we had from our survey work and i think you saw that in your public consultations in terms of the highland comments that were made was about the inclusion of what we would say non-traditional forms of accommodation motor homes etc etc and while that is not necessarily a solution for the issues that we have in the north with a responsible wild camping and people who choose not to go into established campsites as much as we could try and encourage that as a destination management organisation our key concerns in this area has been the impact of motor homes and wild camping so absolutely we would like in the future for the legislation to take this into consideration thanks for that gathie i'll just move on to my second question i've just one sorry just very quickly to say um we've got over nearly 60 of our visitors to arnor day visitors at the moment they wouldn't be paying any any sort of tourism visitor levy and i think there's a danger that that would actually increase and you could argue in actual fact the day tripper has more impact well it does have more impact in the environment and also possibly some of the visitor management issues that people talk about in terms of litter and and dirty camping or whatever but you know i think that has to be it that's a concern for us as well because i think you could see potentially a greater increase in day visitors who are not going to have to pay a lady thanks she'll just say with you there um what are your views on how the bill was developed and how much we've involved in the consultation relating to the bill and if you have been do you feel as if your views have been taken on board so i was i've been quite involved i've been to a lot of consultation meetings prior to and through covid i think as well um and i'm really surprised actually that it's got to this stage because i felt that the the discussions certainly with the businesses and industry at the time were not in favour of imposing anything however um so when you're asking how our views have been taken into consideration it's great to come and talk today and i have to hope that yes views are taken into consideration of course um but it is it's a little bit frustrating because i feel we're going over old ground some of it's old ground and there are things that were raised way back at all these different consultations that i don't think have been addressed in the paper you know things like the exemptions for example it's very little detail in there things like that thank you for that she let anyone else want to come in sorry i would just say that uh as an organisation etag's been involved we've been we've represented ourselves at Scottish government consultations Scottish tourism alliance has run several sessions on on the introduction of this levy and we've been very closely involved with city edinburgh council who recognise the need here for industry to be involved in the creation of of any scheme that that will might arise from this enabling legislation thank you donald okay i'm going to bring in pan goes on thank you convener good morning panel good morning my questions around how the levy is going to be raised and you've probably heard from the past couple of weeks we've heard from industry we've heard from councils and today we've also heard heard from organisations representing industry as well and there have been a few disagreements but one mainly around even today you could hear the views were different around the should the levy be a flat rate or a percentage rate and should it be capped in a well national limit applied to it so looking at obviously businesses are looking at a more simpler process but also business are looking ahead to look at to see that they can forecast how much money is coming in as well and also just adding to that is local authority should they have the freedom to decide whether it should be a flat rate or a percent and you also heard from our european witness last week talking about one place having both so what are your thoughts on the question around should local authorities have the freedom to decide and should it be flat rate or percent and should it be capped could i have my question go to first sheila and then to gary and then open to everybody yeah thank you okay um yes i think that um i think a flat rate if it's going to go ahead a flat rate is the answer and i think that needs to be there needs to be a lot of clarity and transparency around that i think when you get into percentages it makes it really challenging if you've got packages um you know some of our tales do new year packages they do golf packages activity packages so you would have to be withdrawing the accommodation element from that and it just adds in again more hassle for the businesses and we want to try and simplify things i think there also does need to be a cap i think we've got to be realistic about this we don't want local authority saying well let's just let's just force on and put in you know huge vast sums of money i'm sure that wouldn't happen but you just never know so you want to to close that floodgate you know um i think that that's quite important we have a visitor gifting scheme and we originally said it would be a pound per bed night and we've changed that completely and it's it's optional um but we don't it's not cat that's not cat but then that's a voluntary thing that's slightly different so i'm happy to talk about that later if that if the question arises just on that sheila do you think local authority should have the freedom to decide i think local authorities um no i think it's better i personally think it's better and i think visitor would feel happier if it was a national decision because then it's the same as transparent across the board thank you gary um yeah very similar to sheila um obviously there there may be merits to the percentage based approach but in general feedback from businesses on sky really feel that it should be very simple and that flat rate would be preferred and also an agreement with regards to having sort of national consistency as well um however you can see the merits in certain areas being able to have flexibility depending on the impacts of tourism so we understand that but i think for this scheme to work and for it to be accepted you know you don't want it to be difficult for businesses to administer and also um you know different size businesses love different resources you know many of the businesses on sky are like you know sole trader bnb's or very very small businesses and actually adding an extra bit of administration to their sort of work already um is very very difficult so a lot of businesses on sky actually said that they wouldn't have the capacity to to deal with the extra administrative burden that was up to 75 percent of the smaller businesses um so there's lots of considerations there with regards to if if you can make it simple then that would be the way to go and should should the local councils have the sort of say over it you know i do agree on the national perspective but i also agree that you know in a council area if there's multi-stakeholder agreement through private and public sector consultation then you know there could be flexibility there but i think that's people that just don't know so there's still a lot of questions i'm going to put the other view on the percentage or flat rate and i completely understand why there is a spectrum you know you've heard from from quite a lot of witnesses earlier today and in other sessions about the dynamics of the market in different parts of scotland and obviously edinburgh is a kind of prime example of that donald might like to speak further about it but i do think that having a percentage kind of naturally accounts for those variations so if you've got a taylor swift concert or a edinburgh peak festival season you know you're seeing the benefit of that be reinvested in the local economy so i do think that local authorities should have the flexibility to to determine that through a a scheme that they've very thoroughly consulted on so that there's a lot of building of consensus as far as possible within the local authority area the issue of a cap i think is something that the city council in edinburgh has spoken about and is one of the mechanisms that you could use to make sure that you don't get unintended consequences of people like for example the workers that come to stage the festivals every year who are staying maybe for four weeks that would be one way of recognizing in part the different way that they contribute to the economy and that we might want to incentivize their coming so again a cap is definitely something that we would be positive about talking to the local authority about but we would want that to be flexibility at local level there when you're talking about the cap were you talking about the amount of money or are you talking about the number of days because i remember last week paul talked about seven days was going to be the cap so it's the first seven days of accommodation and then after that there wouldn't be a charge that's absolutely right that was the cap that i had in mind was the number of days that it would be charged thanks and donald thank you it doesn't surprise me that there are differing views and i think that leads you into our proposal that there should be a very strong national framework but each area should have the flexibility to introduce the scheme that best suits their local dynamics in their local area and i think that question over a percentage or flat rate from from our perspective and having discussed with the industry in Edinburgh we have come down on on the benefit of a percentage because it reflects dynamic pricing and then and the the vagaries of the market from a busy august as julia has explained to a much quieter january so a percentage levy would be would be what we would we would we would welcome certainly i think it should be capped and it should probably be capped a number of of days but going back to my earlier point the the local flexibility should be able to accommodate local needs and concerns but it should be based on consulting with the industry so that it's not just the local authority that's that's setting this but it's actually been in consultation with the local industry and and you know recognising the you know the need for for this buy-in in order to be able to raise this money to deliver the to deliver the the strategy one of the things that we you know i said earlier on that we've been talking about this for about 20 years one of the aspects that we have gathered important fact that we've gathered from our research is that a lot of the businesses and indeed the residents in Edinburgh said if you're going to do this make it meaningful so that you're raising enough money to make a difference so that we can see the benefit that the the impact of visitors coming to the city raises money which then makes a valuable contribution to making Edinburgh a better visitor attraction for the residents who live here and the visitors who come here. Thanks very much for that and donal i'm curious because you've been busy with this for 20 years and this this issue not me personally not you personally but itag yes apologies for that and the the the issue between a flat rate being simpler but a percentage being fair it connects the dynamic fluctuations as you've just described but have you come across any system that would handle the i think one of the issues with the percentage and the concern is that's complexity and i just wonder if you've come across anything that would help it make make it easier for the levy to be collected well the i think is an interesting question i think the bigger operators will have a system in in their property management system that can cope with a percentage i ran a hotel myself not in Edinburgh but down down south and when the the vat levy changed the vat rate changed during the pandemic from 20 to 5 percent the systems were able to be engineered to accommodate the different levels of percentages for that so bigger bigger operators and more sophisticated property management systems can cope with that one of the one of the the aspects of our strategy and underpinning the strategy and supporting what the levy achieves would be to support businesses throughout this implementation and we've we've represented with city of Edinburgh council that pre-planning and preparation is absolutely vital and that e-tag as a business organization business support organization would be there to develop tool kits and infrastructure to be able to help the smaller operators introduce such such a percentage levy okay so as you've kind of saying maybe there that the first thing that a levy gets spent on is putting the infrastructure in for the businesses well it might not be as as direct as that i think what needs to happen is that money needs to be spent in pre-planning the implementation of this there's a very big need for communication for making sure that the guidance that is being prepared as a parallel work stream to the legislation going through parliament that guidance needs to be very clear to help businesses implement the introduction of this levy and e-tag as an organization will be there to support the businesses in Edinburgh in making sure that this is easy and as smooth as possible thanks very much for that i'm going to bring in miles briggs but before i do i just want to remind Sarah and Kathy please do indicate if you want to come in it's harder for us to know if you want to come in but i definitely want to hear from you as well miles thank you for joining us here and online today i wanted to ask some questions as i have previously with regards to exemptions currently the bill mentions possible voucher scheme taking forward and so just wondered your view on whether or not we should have an exemption scheme and how that would be best taken forward be it nationally or also locally and any work you've done on that to date i know festivals Edinburgh is in favour of the provision so i'll maybe bring yourself in julia first thank you very much there's been some very good discussion earlier this morning about the the wider principles of exemption schemes and the complexities of local and national implementation of that so i'm not going to attempt to approach that territory but we know it's a very big picture i guess the point of view that the festival organisers have put forward is that there are certain dynamics within Edinburgh that for a sustainable visitor economy with the festivals is one of the attractions that not only attracts people to Edinburgh but also to come to Scotland for their holidays and spend rest of their their time in other parts of scotland we know that that relies on artists coming and bringing their work and artists who live here also staging their work in in Edinburgh and that at the platform the biggest platform of the fringe festival where that's self presented and you bring your own money and you invest in that show and take the risk on it it's becoming more and more difficult so there are various ways you could handle that one of them is to make sure that the provision for exemptions or rebates or reimbursements is in the legislation and i think that's what this committee and the parliament needs to be concerned about as the passage of the bill goes through we would then obviously want to have that conversation locally about how you can best approach that and i completely accept what some the accommodation representatives were saying that you don't want to be dealing with that on the front desk and there are other ways of doing that and putting money back into back into the system i would i would agree with with julie i think etag supports the the the local authority having the flexibility to introduce exemptions i think it needs to be very clear and transparent and maybe again going back to my point about national framework maybe there are some categories of exemptions that could be included in the national framework with the local authority having some flexibility to to go further should it should it's so wished to so i'd like to come on come in thank you i think it's clear from the the various few points that there are some very different structures of destinations around the country and based on that we would be very much in favour of having a bespoke model in the islands that certainly reflects the interests of the wider region and the wider country but is really reflective of of the exemptions that we need to function as island communities the differences between the different types of islands that we have where we have some very fragile small islands where travel is absolutely necessary even for basic things sometimes like healthcare and service provision and others of the larger islands where where people can be slightly more more self-contained all of that is a factor that we've already had to address slightly in the island context through through the air discount scheme so we already have a model there where there is a acceptance of recognising the the singularity of island residents versus other travellers and i think it was mentioned by our local authority representative at last week's session that you know something that we would be interested to explore would be moving away from the accommodation based collection which we feel is quite limiting and taking into account the number of motor home travellers cruise passengers coming to the islands the an accommodation only based collection model would seriously limit any any revenue that we could could gather in the islands whereas a port of entry based collection using existing mechanisms would not only take off pressure from some of the the providers in the sector but it would also open up to how much wider range and I think coming to this question of exemptions it's very easy then to to work through why people are traveling it's it can be a tick box as to why they're actually in the in the area or why they're needing to travel and it can also help to differentiate between residents and visitors so we think exemptions and getting the exemptions clauses of the bill right are absolutely critical thanks for that and Sheila you indicated you wanted to come in I agree with what Sarah is saying I think we have to have a very localised look at exemptions we are slightly different than that we're in an urban authority it's a mainland authority but there will be things that the local council won't consider that actually affect the island community just simple things that are very very relevant for our community because our islands there's a lot of commuting goes on both ways staff going both ways we also have a lot of commercials and services that have been brought on to to service machinery and things in the island agriculture and so forth and health and social care as well and also I hate to say it but the stranded passengers because we do get a lot of stranded passengers so that's very specific to our area which probably wouldn't be the same in the rest of North Ayr or possibly other areas of the country so just totally reiterate what Sarah is saying that you know exemptions have to be absolutely bespoke for the area but that the local authority is serving okay okay thanks Stephanie you wanted to come in thank you very much convener and thank you for coming along today to all of our panel online and in person um Donald you already mentioned the consultation and proposed schemes and obviously it's really important that the objectives and the impact are looked at and I'm wondering if you agree with the requirement in part three of the bill that revenues need to be spent on developing, supporting and sustaining the facilities and services that benefit tourists and leisure visitors and do you have any thoughts on how those levies might support your own strategies and your vision for projects etc and it might be good as well to maybe hear from Sheila after you or anyone else that wants to come in thanks okay thank you um as I said earlier on the e-tag facilitated the development of the Edinburgh tourism strategy for 2030 and this was to run from 2020 to 2030 um and we are we're several years into that albeit that the first two years were heavily impacted by the pandemic but we have the we have the strategy we have got our strategic goals to deliver um around people place um environment partnership and reputation and each of these strategic goals have actions uh in order to be able to underpin the delivery of that strategy so for for just for one example within our place strategic goal it's one of one of the key objectives would be how do we manage the help the visitor manage their visit to Edinburgh in order to relieve congestion relieve um you know the impact on the city and potentially uh spread out the benefits of the visitor coming to Edinburgh rather than just concentrating on you know the castle of the royal mile hollywood and in the grass market so that requires significant investment it probably would would require some kind of technical digital app that would help us achieve that and therefore we very much see the levy being raised as one example being able to help us deliver that key strategic goal within our our visitor strategy that would benefit the city it would benefit the businesses because we might be able to spread the the benefits of the the tourism um the the visitor around the city and it would also benefit the residents who perhaps in the in the older town feel a little bit more congested than somebody who might be living up in in Brunsfield so that that is one example of how this levy could help us deliver our our tourism strategy we absolutely would endorse in the legislation that it says that this money should be ring fenced for the you know for the support of a visitor strategy and we think that that's very important in Edinburgh this could be significant amounts of money we're talking about a game changing potentially amount of money being raised in Edinburgh that would would help us deliver the strategy and change the environment for the visitor in Edinburgh and i think is as rob said at the end of the previous session we want to be able to look back in 10 years time and say that that all of this money that has been invested has made a difference and that the the resident in Edinburgh notices it just as much as the as the visitor does and i think that's absolutely critical if we look back and some of this money has been spent on on smaller schemes that are invisible then i don't think that would be as as successful as being ambitious and using this money to invest in much in much bigger schemes thank you we're going to bring in Aaron Sheila and Aaron but if you got something specific to Adam obviously you would have something specific to Edinburgh just a sub to to donal yes apologies Sheila it was just a just to add i agree with everything we were a member of itag and agree with everything that donal said i think that there was if there was one area of that drafting that we were slightly concerned about it was that there wasn't an emphasis on how you can develop local cultures to be attractive to visitors as well and that's something that i think probably everybody who's who's sitting around this table would would be equally attracted to so you know local music cultures local food cultures and so that's something we would just like to to see parliamentarians take into account as as this bill goes forward it's not simply for facilities that are used by tourists it's for facilities that could be used by tourists but are absolutely rooted in that kind of authentic resident culture as well could i just one add one supplementary point you asked us if we agree with the bill regarding leisure tourism which i do but i think it needs to include business tourism that's one of the the missing points i think in the legislation business tourism particularly in Edinburgh through conferences and conventions brings in a significant amount of money to the EICC the hotels and accommodation providers as well as the restaurants in Edinburgh therefore business tourism is a vital ingredient in the whole economic strategy for the visitor economy thanks for that so i'm going to go online first to Sheila and then to Kathy so yeah i think if any money that's generated locally should be spent locally we've got a really good example we've got a visitor gifting scheme the iron trust that's been going since 2011 and the community are very good at telling you what they feel that money needs to be spent on and really if you go back to the national strategy Scotland 2030 you know thriving places passionate people so it's all about that anything we do here on the island always puts community first if it's good for the community then it'll be good for the resident and then it'll be good for the visitor so it's got to be the community first and the community should have the right to pick and choose where that funding is spent rather than being cheated to by others and you know likes a visitor dispersal things like that that should be managed by the dmo you know that's where the dmo's come in and play into their own if you like play into this field very very well because they know the local communities they're working with the local communities and they're in the local communities we're also fortunate in the island because we've got an island plan which is all about community putting community at the heart and vibrant and economy being either side and keeping everything in balance so it's really important that any local money that comes in is spent locally as well in that community thank you for that and Kathy i think well i made clear earlier on that while we would like a lot of the money to be spent in our north island region we are more not about the destination focus and about a broader strategy right across the highlands but based on that i think it really has to be looking at those long-term goals and really transformative developments and strategic builds if these funds were to come in place take for instance on sky they have a visitor management app they're trialling in terms of infrastructure across their area you know what would that look like if we could have that right across the highlands specifically if it was around about the north coast 500 route if you were looking to where we would look you know to build our strategy going forward i also wholly agree in terms of development of other areas that don't have the focus of our visitor attraction if you like for instance in the east coast peninsula just north of Inverness Inverness sky northwest southern get really the vast majority of visitors but we do have other areas like central southern and east coast peninsula there which is out with venture north but they have capacity for visitors so i do think across the highland region we need to look forward long-term and build a strong strategy to manage those funds in the future and really think big basically as to how we could transform that across areas the highlands as a whole is one of the most attractive destinations in the world just now so um you know obviously aside from Edinburgh um but that's you know i think that's where we should focus other things in our area since the pandemic like the use of access rangers have really been instrumental in terms of changing that conversation between a resident and visitor friction that we were experiencing so badly in in the pandemic so we would need to you know that is something that venture north would wholly support and that would be right across the north highland region so beyond those kind of like strategic goals and i said earlier i do believe that we need in the highland region anyway a cross-sectional private public sector you know full management plan over a 10-year period as to how you would manage these funds but going back to a previous comment just to say from the north that we are more for a flat rate rather than percentage i think the previous comments it was very clear that there's a distinct difference between rural areas and city areas like Edinburgh in terms of how we would keep that simple for the businesses we don't have the large organisations or the computer infrastructure to make that simple for our businesses thank you thanks thanks very much you've already come in actually and answered quite a lot of the second part of my question which was going to be about geographical areas as well there and certainly we heard from the previous panel that you know they felt it shouldn't be restricted it could be detrimental to being ambitious there so developing those other areas in alleviating pressures and existing ones is the consultation with councils is it central to that to involve the communities as well as the businesses cafe i'm wondering specifically on yours and it'd be good to hear perhaps from gary and seara very briefly what their thoughts are as well thank you thank you very much and i could see sheila nodding so in our area for instance with our voice with the Highland council is through the Highland tourism partnership so we have a key you know agencies visit scotland Highland council and the regional dmo's and i would say in terms of that being part of the voice of tourism for this area currently there is the dmo's that would represent i would say the community voice but i think if you were looking at a management committee for the funds in the future you would want to make that stronger and i think as i also pointed out earlier on not all areas in the highlands have dmo's representing them and so part of it would be to look at regional plans but also then there is the option as sheila actually pointed out earlier on and i'm sure gary will say that is the role of the dmo's because we're here we're there on the ground we work directly with our communities you know heaven forbid if we didn't because we soon hear about it even even in my own area because i cover sutherland and so regionally you know that's it's quite a vast land mass of area with small communities but you know we live and work here if the dmo's do not focus on communities and a vibrant place for people to live and work in we would be nothing sarah and then gary thank you i would agree with everything kathy has just said regarding the link with communities that the dmo's have and how that cascades into the the wider tourism offering and the sector in more remote areas we are destination management organisations managing that link between the destination and place as opposed to marketing we're not necessarily there to to sell the place although obviously we'll promote if we can so the link to communities and making tourism work for communities is is central to that which was leads into this question around reinvestment of levy revenue as well as the infrastructure and the the investments and the innovations that we can potentially employ and make happen through revenue streams that would otherwise have been been unattainable i think it is also about maintaining some of the grassroots services that that we currently try to provide to visitors and are actually becoming increasingly difficult to to to do so and i think in the previous session mark had talked about profitability being squeezed despite footfall and you know custom perhaps being up and i think that's similar in that we're seeing more and more visitors more and more interest in scotland and in the regions but actually in many ways less of of what's needed there to manage them and we desperately need resource in there to help us with managing our destination websites which cost money managing our visitor information points which are we have one official tourist information centre in the outer hebrides which is based in stormway so if you're in barra or uist or harris or anywhere in rural lewis you you don't have access to a tourist information centre at the conference last week that that mark mentioned attending with us we had a lady who spoke about being expected to provide visitor information via the local craft shop and that they are increasingly seeing themselves as losing sales and revenue there because they spend so long dealing with visitor inquiries about when is the next bus where can they eat out those sort of fundamentals which are needed in a small community and people do want to help and they will give their time but when it starts to impact on their actual business and the revenues then that's not no longer working effectively so we need those kind of grassroots core sources of income that will allow us to keep visitor information strong that will allow us to to improve our visitor offering and keep the whole sector kind of running smoothly and ease those frictions that sometimes do arise between communities who perhaps see less of the the benefit of tourists and who yeah they need to see that's working so the innovations and the big pictures and the doing things differently really supportive of and let's hope we can get there we want the levy to do that for us it's why we support it but we also see some of the the brass tacks maybe being covered as well through the potential to to get some additional revenue back because at the moment there are no other streams that channel that visitor spend back into to the services that support the sector thank you that sir gary is brief as possible so i mean i'd echo all the points made previously and in regards to the opportunity here i guess that what we're hearing is that you know there's a diverse array of needs and challenges across scotish tourism and certainly a lot of differences between urban and rural tourism as well and that all needs to be taken into consideration in this bill dmo's at the moment are actually fighting for survival because funding you know has been sort of it's been put forward that funding may be withdrawn for a lot of dmo's in scotland now it's something that we're talking about here is how do you deliver a strategy nationally how do you have ambition well in an area like scotland you're going to have to have local delivery mechanisms for that as well and it is going to have to be nuanced and i think there is an opportunity to look at the structure of the tourism industry and consider what the role of the different organisations are in england the commissioner report called the debwar report which basically looked at the role dmo's play in the international tourism strategy so in order to get communities on board in order to get areas like sky and and aran and other areas in the highlands on board there has to be a connection between you know the local strategy the national strategy the vision and that's where the disconnect is and that's why you're getting so much opposition in a lot of the rural communities because what they're seeing is this idea of a levy where money is going to be taken out of a community that's already struggling to invest in its infrastructure and not knowing where their voice is going to be within that national picture and so it's great to talk about ambition we all want to be part of an ambitious country that achieves great things and be leaders in 21st century tourism but you know we've got all of these disparate dmo's in areas that we're trying to sort of deal with all these local challenges and needs that are not going away and like i was saying you know there's no money coming back in to reinvest in the tourist infrastructure in these areas and so the needs are often greater in some of these areas thank you very much for that that's very useful willy you would like to come in thank you you're in the space in the territory i was going to ask you about what the role is for the localised dmo's and you've been expressing that very clearly one issue that might come up as the 18 month lead-in proposal and whether you agree with that and mark was it mark dixon rob dixon the big apartment was quite clear from visit scotland's point of view that it was essential to have that space to allow properly worked out thinking between enabling the legislation and putting it into practice so that local authorities could get it right do you see a role a clear role for yourselves as localised dmo's to get that right to help the system get that right yeah definitely i know that the highland council are currently developing their sort of new strategy for tourism based on the opportunities that the tv i will create in terms of you know the money that's going to come in so i think it's essential the fabric of scotland's tourism industry is so diverse you know and the needs are so different so you know if you don't get that input you're not going to get the full picture and i do think that that is what makes scotland attractive to international visitors you know it's not really a place where you come and it's a one size fits all it's very different it's very diverse there's all sorts of sort of interesting things to do here you know and i think that the the voice of sort of local areas which you know are some of the most popular tourist destinations in the country really needs to be heard and needs to be at the table in monthly downtime is that something you would all broadly support so that we can work out the implementation of this local i think that's probably fair we followed the city of edinburgh council in our response to the stage one bill saying that because as you've heard from donald this is an issue that's been being discussed in edinburgh for 20 years now and it is something that we've participated in research about since about 2017 i think we co-funded some research yeah so we feel that the city of edinburgh's discussions with the industry are quite far down the track so that's something that we are conscious that they feel that they could do more quickly than 18 months donald any of you i would i would just say that the 18 month leading is absolutely essential this is a very complicated piece of legislation that's about to be implemented locally and i keep coming back to the fact that is if we've got the proper enabling legislation and framework and then that's the down to the local authority to introduce the scheme as they see that will fit the means the needs and ambitions of their of their local area then that is going to need a lot of consultation and a lot of a lot of work we're fortunate in edinburgh that we've got a strategy implementation group that oversees the edinburgh 2030 strategy that's chaired by councillor day the leader of the council with all the the senior key executives there plus leaders from the industry so for example julia sits in that group chamber of commerce visits scotland you know the airport hotels association so we are a leadership group that has already been discussing you know the legislation and responding to the legislation but also looking forward to how this might be introduced what are the the key challenges and what are the benefits that we could all all realise over spending this amount of money over a protective period of time and that's where the ambition comes in this is this is all about ambition for bigger bigger projects and spending this money successfully i was just to say that i think it would be really helpful if that's part of i think 18 months is realistic provided there is that local engagement that gives time for that to happen but that's really important that local authorities are considering taking this forward and that may be part of it do they consider taking it forward or not that they engage with the local community and at a grassroots level to find out exactly what's wanted and there's as garry said demos are a great way to do that because we engage with the community as well so it would be really great if the committee could endorse that kind of process moving forward thank you that's it okay pan thank you thank you convener we've heard that many businesses don't have the necessary infrastructure in place to collect the levy and that if the percentage rate was applied it may make things a bit more difficult and challenges for small businesses and micro businesses to collect and in response to the consultation the outer herby tourism wrote about initial period of grace from penalties for late returns and return errors suggested around about maybe a year does the panel agree and do you have any thoughts on how local authority can support business to collect the levy to ensure they are not penalised for non-compliance and do you feel that the bill is getting the balance right i think could i probably ask um six six uh yeah seara that question since um that organisation obviously mentioned this thank you um that as i expressed earlier i think um our feeling is that we are having advantage in the islands in in being a very self-contained community um and that potentially the accommodation based collection would not be the the optimum one for us however if that is the route that the local authority chose to go down and the onus was put on to the individual businesses to be the liable bodies for collection we feel that it's only fair to give a period of time for them to to find their feet with that to understand how it works i think there is a slight perception in some sectors or some parts of the sector that the especially among smaller businesses that the the levy is almost coming on to them rather than them being the the vehicle by which it's collected so there's a little bit of kind of messaging there um i think somebody has previously mentioned uh the the need for the levy to be um not push over the vat threshold and are there mechanisms that could be put in place that reflect that it really is that the small businesses are a conduit to pass the levy on rather than actually um impacting directly on on their own profitability so i think there are various things there to be got right and even if the the financial structures and the modelling and everything is is done really really well which i hope it would be and would totally support that 18 month leading to get it right i think there's still room for error and in order to be supportive of small businesses and to bring the the tourism sector with us it's going to be crucial that that it is seen to be a soft touch and light touch as possible um before anything like enforcement or penalties are are introduced um and that may be something that comes later if there is evidence that people are abusing the structures but i think initially we have to to do this in favour of the businesses we represent i'm going to move on to bring in mark griffin thanks community i just had a question for witnesses around the financial memorandum and the modelling of costs um to businesses particularly um smaller and micro businesses and just to ask whether you feel that um the cost burden that will be placed on those businesses is adequately reflected in the policy memorandum including the the potential issue of pushing some of those businesses over the vat threshold whether that's been properly recognised and modelled and i'm going to come to gary first since you touched on it on an earlier question yeah i think that probably more consultation needs to be done around that area um i think that the issue with vat is still quite unclear with a lot of businesses at the moment um so it's definitely something that sorry could you repeat the end of the question there i missed the end of it whether the financial memorandum is reflecting the cost burden that's going to put on small businesses and particularly the issues of pushing them over a vat threshold i think based on our survey results people are still concerned about you know the potential cost implications and administrative burdens certainly in smaller businesses so there might be more that needs to be done to reassure people um so that might require a little bit more research into that potentially um so that would really be all i have to say on that okay thanks gary at donald i would i would say that it's so important that the cost to the operators for introducing and collecting this levy is is properly refunded to them and that their cost incurred is recovered and i think that that's also two for the local authority i think that the local authorities have to set up an infrastructure to help collect this and administer this then i think that should be part of the of the cost recovery right the way across um you know nobody nobody wants to put pressure on businesses to collect this levy which should then be invested in in strategic goals i think that would be a little bit a bit contrary to to this strategic goals to put pressure further pressure on on businesses so i think cost recovery is absolutely key i agree with gary that further discussion needs to be had over this particularly over the the vac thresholds pushing somebody into that threshold because you're collecting a levy that is not part of your revenue stream which you then got to rebate to a local authority doesn't make sense to me and i think that needs to be that needs to be discussed um but i think cost recovery is is absolutely vital the the one thing i would just add to the previous question i i do not think that again this is about pressurising businesses and there should be some grace about compliance and collection particularly for the micro businesses thank you anyone online no no okay i want to add about OTAs which is a potential collection method which could reduce some of the administrative burden and costs but it's unclear how that would actually that would actually work a lot of on sky a lot of the accommodation providers will use booking.com things like that Expedia there are others but yeah that is a potential mechanism that would reduce some of the administrative burden on some of these businesses thanks for that and finally can we just kind of catch all questions to ask people what what their view is on you know a couple of years down the line if this legislation passes and is it implemented what should we be tracking in the future to to really define what would be the measure of success or what we should be reviewing to track that this is actually working it's positive and it isn't damaging the sector shall I go yeah please well i think you've heard me say throughout this session that actually for Edinburgh this is quite significant because the level of money that is likely to be raised through the visitor to support the visitor economy in but it is significant and this requires i think serious consultation serious thought serious preparation in order to make sure that this is implemented and it is right and i think that this is a game-changing amount of money that is a that could potentially be invested into the visitor economy in Edinburgh in order to achieve our strategic goals and and i think that in 10 years time having invested you know could be could be hundreds of millions of pounds over the next 10 to 15 years what is Edinburgh going to see for that that that investment and as leaders of the industry we must be prepared to to be ambitious and to stand up and deliver some of the bigger projects so that the visitors and the the residents see the the the connection between okay well yes visitors come to Edinburgh but they contribute to the city and this is what this contribution has delivered and i think that's a very very important connection this is not should we should not see this particularly in Edinburgh as being um and i hate to use this word uh in fact i won't use it as a but it's a contribution to the the infrastructure and and the facilities and Edinburgh as a destination that should in 10 years be thriving and vibrant and and be world beating that's what we need to set our sights on and that's what this is the potential to achieve and that cuts across Julia sector in culture world heritage you know the the the genuine hospitality sector in terms of hotels restaurants and bars transport it will cut across everything if i could just briefly add to that i think that it speaks to the points you've heard about already about it needs to be additional and not substituting for for general core services it needs to be a kind of virtuous circle that residents can see the benefit of as well as visitors and so yes it should be for solutions where there are pressures but only in those very specific areas where the pressures are going to help with the sustainable development of the visitor economy and more importantly it should be in the ambitious stimulus but that includes both infrastructure because everybody's got infrastructure pressures as a lot of people have talked about and activity because again when you go back to things that are the lifeblood of all of our communities you know clubs music food cultures you know it that's i think a sweet spot for Scotland because Scotland is really is rooted in it's appeal is rooted in its local culture so we mustn't going to get a sort of too distracted with capital investment only it must also be be into revenues for communities there's a few people online you want to come in i just want to ask we are wildly over but that's i mean i don't think we could have done this really in an hour so really important to give you the time but we've got some other things we have to have to cover this morning after this session so i'm going to bring in Sheila and then Kathy just to say that i think visitors need to see the difference if this is to be implemented success in you know in five years 10 years whatever visitors need to see the difference so they can see where their money's going and they know that that it's actually adding value to the destination thank you and Kathy to i think Rob Dixon's or Mark Corthall's views earlier on in terms of how we measure success and i say that very carefully in terms of as i said earlier we are marginally against a visitor levy in this area but for those for or against it is looking for clear evidence that we have thriving places to live work and to enjoy a thriving visitor economy and and also just that place where residents are delighted to live in and welcome visitors to the area so i think that is the way in the say 10 years time that while the sums of money may be game changing but we need to manage them well and responsibly for a sustainable future okay i think that sounds like really perfect note to end on Kathy i think you really summed that up beautifully um so thank you all so much for coming uh well it's now this afternoon but today uh to share your views with us so it's been very helpful uh we'll conclude our evidence taking on the bill at our next meeting in which we expect to hear from cosla followed by the minister for community wealth and public finance and uh we're just going to do another little bit of business if you can just hang on there so we now turn to consideration of the title conditions scotland act 2003 conservation bodies and rural housing bodies miscellaneous amendment order 2023 there's no requirement for the committee to make any recommendations on negative instruments do members have any comments on the instrument no comments is the committee agreed that we do not wish to make any recommendations in relation to the instrument we are agreed thank you we previously agreed to take the next items in private so as that was the last public item on our agenda for today i now close the public part of the meeting