Overview
- Ministers opened a 12-week consultation on GOV.UK, closing 18 February 2026, to decide rates, potential caps, ring-fencing of revenue and whether to extend the power beyond mayoral areas.
- The charge would apply to overnight stays in hotels, holiday lets, B&Bs and guesthouses, with exemptions for emergency accommodation and homeless shelters, and the final rate remains under consultation.
- Supportive mayors say revenue would fund transport, infrastructure and visitor services, with estimates of about £17m a year in Liverpool and up to £240m in London, and a CPU analysis suggesting more than £1.2bn nationally if widely adopted.
- Hospitality groups and operators including UKHospitality and Butlin’s criticize the plan as a new cost for consumers that could deter UK breaks and weaken investment, with UKHospitality estimating an extra £518m borne by visitors.
- Adoption is discretionary, with Liverpool expecting region-wide coverage including Airbnb-style lets after its ABID scheme ends in 2027, while Tees Valley mayor Ben Houchen has pledged not to introduce a levy.