The government is set to grant mayors across England the power to introduce a local “tourist tax” as part of a wider push for regional devolution.
Deputy Prime Minister Angela Rayner is meeting with regional leaders today, 10 September 2026, at the “No 10 North” office in Manchester to confirm the plans. The new “overnight visitor levy” is designed to allow mayors to raise funds for reinvestment into their local areas, specifically targeting improvements to transport, high streets, and the visitor economy.
Unlike flat-fee models used in some international cities, the English levy will be calculated as a percentage of the total accommodation cost. The government suggests this model protects budget holidaymakers, as those staying in lower-cost hotels will pay a smaller amount than those in luxury accommodation.
The tax is theoretically uncapped, meaning mayors will have the discretion to set their own rates without a national upper limit. While certain exemptions will be mandatory—such as for those using homeless shelters or domestic abuse refuges—mayors will have the choice of whether to exempt other sectors, such as campsites.
Impact for Sussex and Chichester
While Chichester is a major tourism destination, the ability to introduce such a levy depends on the presence of a regional mayor. Currently, the legal framework for this does not exist in the area.
On 7 September 2026, the government paused the Local Government Reorganisation programme, which included the proposed “Sussex & Brighton” mayoral deal. Until a mayoral role is established, or the powers are extended to “foundation” authorities without mayors, Chichester will not be able to implement the levy.
Industry reaction
The proposal has met with significant resistance from the hospitality sector. Industry body UKHospitality has warned that the introduction of a patchwork of different tax rates across the country could put 33,000 jobs at risk and cost the economy £1.6 billion in lost activity.
Critics argue that an uncapped percentage-based tax could make England less competitive as a destination, particularly for families and business travellers already facing high costs.
According to government plans, legislation will require that any revenue raised from the tax is ring-fenced for local use. This could include funding for regional bus networks, the maintenance of historical landmarks, or the upkeep of town centres heavily impacted by seasonal tourism.
