York is newest UK metropolis planning a vacationer tax that will see guests pay further for lodge rooms to assist fund historic points of interest

York has become the latest UK city to consider a tourist tax that would see visitors pay more for hotel rooms in a bid to boost funding for its historic attractions.

The Labour-run council is now speaking with hospitality firms about bringing in a European-style small nightly charge for those staying at accommodation in the city.

No amount has been suggested, but York had nine million visitors last year, including 1.7million who stayed overnight – so even a £1-a-night charge could raise significant funds to help upkeep sites such as the Roman walls and Shambles shopping area.

It comes as London Mayor Sadiq Khan considers a tourist tax on the capital’s hotels – with his team now looking at the evidence from Manchester and Liverpool, which have already brought in similar charges, as well as other cities around Europe.

In England, there are no powers held by the central government, local councils or mayors to introduce a tourist tax, unlike in some European cities – but Manchester and Liverpool both introduced one in April last year through a legal workaround.

The city councils brought in tourism-based Business Improvement Districts (BID) to collect additional business rates payments from firms operating in specified areas.

York could copy this model in an attempt to help pay for maintenance of its historic sites and public spaces amid concerns from council leaders about a lack of funding.

Katie Lomas, a Labour councillor on York City Council who is the executive member for finance, told The Telegraph: ‘People are already very used to paying an extra small charge per night on their hotel bill for the tourist tax in Europe.

‘What we want to do is look at how we charge a levy for tourists. York has a vibrant tourism economy and that’s great for the city and brings a lot of income to local businesses. But it doesn’t give any income to the city council for the maintenance of public spaces.’

She added: ‘There’s no funding from the Government for things like maintaining historic assets. From the discussions we have already had with the hospitality industry, I don’t think they would have any concern about the type of levy we would introduce.’

But Conservative councillor Chris Steward said he did not support the tax, telling The Telegraph that because they ‘are becoming more common on the Continent, a lot of councillors see it as a good way to get a bit of free money’.

He added: ‘I think it would just be seen as a revenue raiser. We’ve got a Labour council that is freely spending money and just wants more money to spend to fix their black holes.’

The idea could be considered in the City of York Council’s budget proposals for next year, but for now the council continues to consult with the hospitality industry.

Councillors will also be keeping an eye on developments in London, where Mr Khan is considering a tourist tax on the capital’s hotels despite warnings from hospitality bosses that it would be ‘extremely damaging’ for businesses.

The idea was discussed by politicians at the Centre for London think tank’s conference last month – and the Mayor was asked whether he would support such a charge, although no figure has yet been suggested.

According to The Standard, Mr Khan said: ‘I’m happy to look into where it’s worked, what the issues are in relation to that particular policy… We’ll be looking at what cities are doing not just across Europe, but in the UK as well.’

Pressed on whether he supported the idea in principle, Mr Khan said: ‘Let’s wait and see what the evidence is. I’m somebody who believes in following the evidence.’

But Kate Nicholls, chief executive of the UKHospitality group, told MailOnline that hospitality businesses are ‘already burdened with increasing costs in every part of their operations, with an additional £3.4billion in employment costs and business rates hitting in April, so further taxes on the sector would be extremely damaging to the sector’.

And Alessandro Georgiou AM, the City Hall Conservatives’ economy spokesman, said the tax ‘would be another revenue stream for Sadiq Khan to waste on frivolous projects and giveaways to his union mates, let’s be very clear’.

Tourist taxes, which are common in cities across Europe and in Canada, are a levy on the occupation of short-stay accommodation in a local authority area.

They a normally a charge per occupied bed or room and are set at a flat rate such as €2 per bed per night, or as a percentage of the price of the bed or room.

Manchester’s BID levy, known as the ‘City Visitor Charge’, is payable by hotels and serviced apartments with a rateable value of £75,000 or more, in an area within Manchester city centre and a small adjoining part of Salford.

The levy is expected to raise up to £3.8million per year between 2023 and 2028 – and a report from the BBC in April 2024 found it had raised £2.8million in the first year.

In Liverpool, the BID levy covers the whole city and is payable for accommodation properties with a rateable value of £45,000 or more, with a cap of £50,000 per property.

The levy is 1.6 per cent of a property’s rateable value, rising to 4.5 per cent in 2024/25 and 2025/26. It is expected to raise £939,000 per year in the latter two years.

In Scotland, Edinburgh City Council is now drafting a scheme for a tourist tax and hopes to launch it from April 2026 – while Aberdeen, Highland and Argyll and Bute councils are also planning to consult on a levy.

In Wales, proposals for a tourist tax began going through the Welsh Parliament last month – but have prompted fury from the Welsh Association of Visitor Attractions which has urged its members to shut for one day in protest.

The bill will now be considered by the Senedd, with a final decision not expected to be made until next year.

The UK’s first so-called coastal tourist tax across Bournemouth, Christchurch and Poole in Dorset was approved in May following a ballot of hoteliers.

It would have required guests staying in larger hotels to pay an extra £2 per room, per night – but this was then put on hold in July following opposition from more than 40 hotels who lodged an appeal with the government over how the ballot was conducted.

This week, it was revealed that the appeal was being considered by Housing Secretary Angela Rayner.

Thanet District Council in Kent had also been considering a tourist tax, but dropped the plans in April after concluding it does not have the power to implement them.

The idea had also been discussed by Cornwall Council, but officials decided against it in July amid concerns over the impact on the tourism sector.

Birmingham has been considering plans for a £1 charge since 2020, when it was put forward before the 2022 Commonwealth Games.

Bath Council has also been discussing a proposal. But in Cambridge, hoteliers rejected a proposal in July to introduce a nightly £2 tourist tax.

The idea of a tourist tax in London was previously floated in January 2017 when the Greater London Authority published a working paper on the topic.

It cited three arguments for a tourist tax – one being that foreign tourists are able to ‘free ride’ by enjoying London attractions with free entry because they do not bear the same costs as UK and London taxpayers who support their funding.

A second is that tourists can also enjoy the benefits of many public goods in London such as parks, policing or elements of the transport network without having to pay the full social costs.

And thirdly, it was suggested that tourists impose costs on society such as pollution and congestion from use of the transport network, which affect London residents and other tourists.

The Institute for Fiscal Studies previously estimated that a tourist tax in England with a charge of £1 per person per night would raise approximately £420million per year.

The Northern Powerhouse Partnership estimated that £428million could be raised. In comparison, council tax raises about £30billion and business rates about £25 billion per year in England, according to Government figures.