Time for a London Tourist Tax?
The idea of a London tourist tax is gaining traction again, with new backing from a leading think tank and renewed calls from City Hall. The proposal suggests that a small levy on overnight visitors could generate much-needed funding to support arts and culture in the capital, particularly as the sector continues to face mounting pressure from years of funding cuts.
In a report released on Thursday, the Centre for London argued that a modest tax on tourists could help revitalise London’s creative industries, which have seen local authority funding per head halved between 2010 and 2021. Rob Anderson, the think tank’s research director, said: “We need to re-invest in our arts, to safeguard London’s continued cultural success and ensure that more Londoners can benefit from the city’s world-class offer.”
The concept is simple enough: guests pay a small charge added to their hotel bills, much like the systems already in place in cities such as Paris and Berlin. The funds raised would then be ringfenced to support cultural programming across London. At a recent panel hosted at the Barbican, GLA assistant director Shonagh Manson confirmed that her team has been pushing for this approach for several years, saying: “This is the idea that visitors to a city pay a small amount extra on their hotel bill… that then gets reinvested.”
Mayor Sadiq Khan echoed that view last month, stating: “Most tourists in Europe don’t really mind paying the extra few euros.” He’s now publicly calling for a change in national legislation to allow the Greater London Authority to introduce such a tax – something they cannot currently do independently.
As it stands, the Government says there are “no plans to introduce a tourism tax in England.” Local authorities may set up voluntary levies through the Accommodation Business Improvement District (BID) model, but there’s no clear mechanism for London-wide action.
With an estimated 30 million tourists visiting London annually, even a modest charge could yield substantial returns. Many in the arts sector view this as an opportunity to reinvest directly into making culture more accessible for all. According to Anderson, the risk is that “reductions in funding have made it harder for London’s arts sector to offer the kinds of affordable, local and convenient offerings that widen participation.”
In addition to the London tourist tax, the Centre for London’s Arts for All report recommends restoring local authority culture budgets to 2010 levels and introducing a national Arts Pass for under-25s. The proposed changes would create more opportunities for Londoners from all backgrounds to access what makes the capital such a unique cultural hub.
While the Government has yet to comment on the report, calls for a national conversation on the funding of culture are growing louder. As Manson pointed out, “It’s our job, collectively, to make the case for that to go to culture. That is not a given.”
For more updates on London’s cultural future and public policy debates shaping the city, visit EyeOnLondon.
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