Edinburgh is set to implement a new 5 per cent levy on all overnight accommodations for visitors starting in the summer of 2026. The City of Edinburgh Council initially approved draft proposals for the Visitor Levy scheme last summer, with the policy receiving formal approval from councillors on Friday, January 24, 2025.
From July 24, 2026, a 5 per cent fee will be applied to the cost of overnight accommodation in Edinburgh, capped at five nights in a row. Businesses will need to apply the levy to any advance bookings made as of October 01, 2025, for stays on or after July 24, 2026.
The levy is projected to raise up to £50 million a year once established, for the city to invest in protecting, supporting and enhancing Edinburgh’s worldwide appeal as a place to live and visit.
The final proposals for the scheme have been updated to provide accommodation providers and booking agencies with extra time to prepare systems for advance bookings ahead of next summer’s launch.
Council Leader Jane Meagher described the decision as a transformative moment for the city. “Introducing this ground-breaking visitor levy means realising a once-in-a-lifetime opportunity to invest tens of millions of pounds towards enhancing and sustaining the things that make our city such a great place to visit – and live in – all year round,” she said.
The levy, which has garnered significant backing from local residents, businesses, and stakeholders, aims to sustain Edinburgh’s status as a world-class cultural and heritage destination while managing the impacts of a thriving visitor economy.
Neil Ellis, Chair of the Edinburgh Hotels Association, welcomed the levy, emphasising its potential to improve the visitor experience. “This is a fantastic opportunity to further enhance Edinburgh’s reputation on the world stage as a must-visit destination,” Ellis said.
Donald Emslie, a representative of Edinburgh’s tourism industry, highlighted the levy’s broader benefits. “The levy’s potential to generate transformative funds for the benefit of all who live, work, and visit Edinburgh is well recognised. It will support city operations, cultural offerings, and sustainable destination management,” he said.
Scheme Objectives
The Visitor Levy Scheme aims to sustain, support, and develop Edinburgh’s vibrant cultural and economic landscape while effectively managing the impacts of a thriving visitor economy. The primary objectives include:
- Strengthening public services, programs, and infrastructure to ensure a safe and enjoyable experience for both residents and visitors.
- Preserving Edinburgh’s cultural, heritage, and events offerings, maintaining its competitive global reputation.
- Fostering innovation in the city’s visitor economy to address environmental and societal challenges while promoting responsible tourism.
Council officials emphasised the scheme’s alignment with the priorities outlined in Edinburgh’s Business Plan, ensuring that investments will benefit both residents and tourists alike.
Scope and Duration
The levy will apply to overnight stays booked from October 1, 2025, for accommodations on or after July 24, 2026. Covering the entire City of Edinburgh Council boundary, the scheme will remain in effect indefinitely unless amended or terminated by the Council.
The levy rate
The levy rate will be 5 per cent, payable for a maximum of five consecutive nights and will apply at the same level, year-round, across the entire City of Edinburgh Council boundary area.
Accommodation liable for the levy
The levy will apply to all overnight accommodation, including those with an annual turnover below the applicable VAT threshold, based within the City of Edinburgh Council boundary.
This includes:
- Hotels;
- Hostels;
- Guest houses;
- Bed and breakfast accommodation;
- Self-catering accommodation, including short-term lets;
- All paid accommodation on caravan sites and campsites, including temporary tent and campervan pitches;
- Accommodation in a vehicle, or on board a vessel, which is permanently or predominantly situated in one place; and
- Any other place at which a room or area is offered by the occupier for residential purposes otherwise than as a visitor’s only or usual place of residence.
Certain accommodation providers may apply to the Council for a discretionary site exemption if they meet both of the following criteria:
- The property is occupied by a charity or trustee of a charity; and
- Overnight stays must be wholly or mainly for charitable purposes.
This discretionary exemption is aligned with the cases where charities may receive mandatory relief from paying Non-Domestic Rates and may be cross-checked with that register.
Accommodation providers who do not charge for overnight accommodation, or who cater fully for individuals who are exempted from paying the levy are not liable for the levy.
Individuals exempted or excluded from paying the levy
The Visitor Levy is payable by anyone staying in accommodation which is not their only or usual place of residence (temporary or otherwise). Individuals who do not have an only or usual place of residence are therefore not required to pay the levy. This includes people who are homeless, refugees and asylum seekers and people whose homes are unfit or unsafe for habitation. In addition, individuals defined in s. 14 (1) of the Act are exempt from paying the levy.
Individuals who are exempt or excluded will need to pay the levy to the accommodation provider and request reimbursement from the Council, unless their accommodation has been arranged and paid for directly via the Council. Reimbursement can be applied for online, submitting relevant evidence (as detailed below and on the Council’s website) and bank details (to enable payment via BACS). Alternative provision can be made for those who do not have internet access.
Evidence which will be required to be submitted includes:
- The name of person exempted/excluded;
- If exclusion applies, verification of such status from relevant official body (this can include the Council’s Homelessness service, Social services, relevant third sector provider, Police Scotland etc);
- If exemption applies, a copy (scan/photo) of the relevant benefit award letter or similar document;
- Booking confirmation/accommodation invoice – the name of the person exempted/excluded should be included on this document; and
- Proof of payment for overnight accommodation.
The Council will assess the evidence received and pay the reimbursement via bank transfer within 5 working days if the applicant is found to be eligible.
Accommodation providers who fail to comply may be subject to penalties.
The funds generated from the Visitor Levy will be strategically allocated to enhance Edinburgh’s appeal and sustainability across key areas. A significant portion, 55 per cent, will be dedicated to city operations and infrastructure, ensuring the city remains functional and welcoming for both residents and visitors. Another 35 per cent will support culture, heritage, and events, helping Edinburgh maintain its status as a world-class cultural destination. The remaining 10 per cent will focus on destination and visitor management to promote responsible tourism. Additionally, the levy will contribute to housing and tourism mitigation, participatory budgeting initiatives, and offsetting administrative costs for accommodation providers, creating a comprehensive approach to city development and visitor experience.
To ensure the scheme achieves its objectives, the Council will conduct reviews every three years, consulting with a newly established Visitor Levy Forum. The Forum will include equal representation from the community and business sectors, with at least 40 per cent women representation.