Local leaders across England have been granted new powers to introduce a “visitor levy” on overnight stays, a move designed to shift economic control away from Westminster and drive investment directly into regional communities.
The measures, announced on 10 September 2026, provide a statutory framework for local authorities to charge a small fee for hotel and short-stay accommodation. The government intends for the revenue raised to be reinvested into the local “visitor economy,” supporting the infrastructure and services that sustain tourism hubs.
The development is a core component of the English Devolution Bill, which aims to reduce regional inequality by handing local leaders more autonomy over their economic futures. To unlock these specific financial levers, authorities will be required to produce “Local Growth Plans” that align with national industrial strategy.
How the “tourist tax” works
The visitor levy is expected to follow models already seen in European cities and the voluntary “City Visitor Charge” established in Manchester. Under the new statutory framework, councils can propose a small fixed fee—typically a few pounds per room, per night—for visitors staying in paid accommodation.
Crucially, the legislation ensures that funds collected through the levy are ring-fenced. Instead of disappearing into general council budgets, the money must be used to enhance the local area’s appeal to tourists, which could include maintaining public spaces, supporting cultural events, or improving transport links.
According to a report by Reuters, these powers are part of a wider drive to empower regional mayors and local leaders, giving them the tools to stimulate growth without relying solely on central government grants.
The path for West Sussex and Chichester
While the powers are now available nationally, they are tied to the progress of devolution. For the levy to be implemented in areas like Chichester, a formal devolution agreement must be in place. West Sussex County Council has been actively pursuing such a deal, currently negotiating for “Level 2” or “Level 3” status with the government.
As a major destination for tourism—home to Chichester Cathedral, the Festival Theatre, and the nearby South Downs—the district could see significant investment if a levy were eventually adopted. However, the government has stressed that the power to introduce a charge is not a mandate. Before any fee can be applied, local authorities must conduct a formal consultation and hold a vote to ensure the move has the backing of the local community and businesses.
Industry reaction and next steps
The proposal has met with a mixed reception from the hospitality sector. While some local leaders welcome the ability to fund essential improvements, some industry groups have expressed concerns regarding “double taxation” and the potential impact on UK competitiveness for international travellers.
There is currently no immediate change to hotel prices. The implementation process is expected to be gradual, as councils first work to finalise their devolution deals and then move through the required public consultation phases. It also remains to be seen whether the levy will extend to short-term holiday lets, such as those booked through online platforms, or if it will remain restricted to traditional hotels and guest houses.