Questions have been raised as to whether the Welsh Government has taken the right path in tackling the housing crisis and rise in second homes in Wales as fears many will avoid the new tourism tax. Last week the government launched a consultation detailing how they aim to "establish a level playing field for all visitor accommodation businesses" operating in the tourism sector.
Under this, new licencing - or tourism tax - would affect all types of visitor accommodation. These include “A room, group of rooms, structure or building, plot of land for siting of temporary transient accommodation, temporary or transient accommodation (caravan, motorhome, tent or other temporary structure), or boat which is not a person’s fixed address.”
There have longe been calls from the tourism industry to introduce a new registration system to increase statutory and professional compliance among casual letting and pop-up accommodation providers. However, as a result of the new Welsh Government consultations concerns have been raised about its delivery, and whether some operators will be able to avoid the new charge.
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Speaking to North Wales Live Adrian Greason-Walker policy advocate for the Wales Tourism Aliiance (WTA) has raised concerns that a register of businesses will be incomplete, enabling some to avoid enforcement – and even avoid a visitor levy (tourism tax) should the consultation go ahead in its current form.
He said: “There is a growing belief that it will be too easy for low-quality, non-professionals to operate out of sight of any scheme,” she said.
“How can local authorities be expected to identify visitor accommodation operating outside traditional marketing channels, or who are difficult to recognise behind online booking agency anonymity? There will be nothing “equitable” about a tax raised on the back of a register which misses wild campers, unregulated pop-up sites, second homes selling space on Instagram, campervans parking in lay-bys or individual homeowners staying with friends and putting their home online as accommodation for events.”
The plans cover all types of visitor accommodation, however exemptions may be possible which have raised concerns. One problematic area is the caravan sector where questions have been raised as to whether pitches or caravans will need licensing. Another is the sub-letting of privately owned caravans on licensed parks:
A commitment to clamp down on second homes was part of the three-year co-operation deal agreed between between Labour and Plaid Cymru. Designated Member Siân Gwenllian said: “Through our Co-operation Agreement, we are taking radical and immediate action to address housing market failures and the lack of affordable housing, using the planning, property and taxation systems to make a difference.
"This proposed licensing scheme is part of our approach, making it a requirement to obtain a licence to operate visitor accommodation, including short-term holiday lets. There has been a huge increase in the short-term holiday let sector in recent years which is exacerbating the housing crisis in Wales.
"While we have a regulatory framework in place in Wales for private rental accommodation, there isn’t one that covers all types of visitor accommodation. Our proposals will bring greater safeguards to local communities on the use of residential dwellings as short-term holiday lets in particular, whilst enhancing the visitor experience and visitor safety in Wales.”
North Wales Tourism last week estimated after the consultation report published by the Welsh Government that a visitor levy will cost the sector £100m-a-year and lead to 2,500 job losses.
Why is the new licencing being proposed?
The Welsh Government report said that new licensing could:
- provide the mechanism to address concerns on compliance
- provide a comprehensive database of exactly who is operating in the industry as it is currently not possible to determine how many visitor accommodation businesses there are in Wales, or in any given community;
- be a valuable tool in understanding the scale and nature of the sector.
Economy Minister, Vaughan Gething said: “The visitor economy is changing rapidly, and the role of visitor accommodation presents major challenges for communities across the world. For example, the growth of online booking platforms has brought many benefits, such as new routes to market and increased consumer choice.
“However, we are aware of the concerns around compliance with existing requirements and the impact of short-term lets on housing stock and our communities.
“Our plans to develop statutory licensing scheme will be focused on levelling the playing field as part of a long-term response to the major challenges we face.
“Over the course of the past year, we have been exploring and engaging with stakeholders on how such a scheme could work in Wales. As the consultation now opens, we would like to hear further views and would encourage the sector to respond to the consultation.”
What is being proposed in the consultation?
Licensing will affect all types of visitor accommodation defined as: “A room, group of rooms, structure or building, plot of land for siting of temporary transient accommodation, temporary or transient accommodation (caravan, motorhome, tent or other temporary structure), or boat which is not a person’s fixed address.”
For licensing, these places must be seeking payment or “any other benefit” and new rules will be implemented on the standard of the accomodation. Alternative, cheaper, licences will be available for one-off events in a place where there is a shortage of available accommodation, however, there will be limits on these.
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