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UK tax3 Sep 2026

England sets a tourist tax for 2028. Most such taxes needed over a year for a Bill.

The Prime Minister told the Commons on 1 September that mayors will get the power to charge a tax on overnight stays from the end of 2027-28.

4 min read

What happened

In a Commons statement the Prime Minister says the next stage of English devolution will include fiscal devolution, starting with the ability to set an overnight visitor levy, to commence towards the end of the financial year 2027-28.

What is new is the start date. The power itself was promised before. The Prime Minister told the Commons that mayors in England would be able to set an overnight visitor levy, a charge on overnight stays, starting towards the end of the 2027-28 financial year.

He said it was part of the next stage of English devolution, set out in a July statement, which moves powers long asked for by mayors to local areas. He named post-16 technical education, help with finding work, and fiscal devolution, meaning control over some taxes. The visitor levy is the first of those tax powers.

The previous government announced the levy on , the day before its Budget. It would let England’s mayors charge for overnight stays at hotels, holiday lets, bed and breakfasts and guesthouses.

A consultation on how the power would work ran from to . As of this week the government page still says the department is analysing the responses.

The King’s Speech of , where the government sets out the laws it plans, then listed an Overnight Visitor Levy Bill. It called the Bill the first step in a new era of fiscal devolution and said a response to the consultation would follow shortly. No such Bill appears on Parliament’s register.

Scotland and Wales are already there. Edinburgh’s 5 per cent charge starts in July and other Scottish cities follow in 2027. Welsh councils will be able to charge £1.30 a night from the same year.

The Visitor Levy (Scotland) Act 2024 became law on , and the Welsh Act on . So by the time an English mayor can charge a pound a night, Scotland and Wales will have had the power for three to four years.

Sources: GOV.UK (2, 3, 4), PoliticsHome, legislation.gov.uk

The Pattern

We looked at every time since 2007 that the UK government announced a new levy or tax that councils or mayors in England would charge and keep. For each we asked one question: did a Bill giving that power have its first reading in Parliament within twelve months of the first government paper? Changes that needed no Bill are left out. Five cases fit, too few for us to show a percentage. The visitor levy, announced on , is the open sixth.

N/A
Two of the last five promised local levies reached a Bill within twelve months: the late night levy (consultation summer 2010, Bill 30 November 2010) and 50 per cent business rates retention (proposals by August 2011, Bill 19 December 2011). Three did not: business rate supplements (October 2007 to December 2008), 100 per cent retention (October 2015 to January 2017) and the Infrastructure Levy (August 2020 to May 2022). Five cases is the full record and below the six Hunch requires to show History.
2020 Infrastructure Levynot held
The Planning for the Future white paper of proposed replacing the community infrastructure levy with a nationally set, value-based Infrastructure Levy charged by local planning authorities; the Levelling-up and Regeneration Bill providing for it had its first reading on , twenty-one months later (gov.uk; bills.parliament.uk, Bill 3155). Sources: [1]
2015 Business rates, Osbornenot held
On George Osborne announced that local government would retain 100 per cent of business rates by the end of the Parliament; the Local Government Finance Bill providing for it had its first reading on , fifteen months later, and did not become law. (gov.uk; bills.parliament.uk, Bill 1946) Sources: [1]
Show the other 3 cases
2011 Business rates retentionheld
The Department for Communities and Local Government set out its proposed business rates retention scheme in the Local Government Resource Review, with technical papers published on ; the Local Government Finance Bill had its first reading on and became the Act of 2012 (gov.uk; bills.parliament.uk, Bill 922). Sources: [1]
2010 Late night levy, Home Officeheld
The Home Office consulted on a late night levy for councils in its Rebalancing the Licensing Act consultation in summer 2010, the Welsh edition published on ; the Police Reform and Social Responsibility Bill, whose long title provides for the levy, had its first reading on and the government response was published alongside it (gov.uk; bills.parliament.uk, Bill 754). Sources: [1]
2007 Business rate supplementsnot held
The Business Rate Supplements white paper of proposed a power for the Greater London Authority and certain councils to levy a supplement on business ratepayers for economic development; the Business Rate Supplements Bill had its first reading on , fourteen months later (gov.uk; bills.parliament.uk, Bill 358). Sources: [1]

The Read

History leans slightly against a Bill by . Only two of five such taxes reached a Bill within a year, and in both the consultation turned into a Bill within four months. This one has not taken that path. Its consultation closed in February, and the response promised in May has not appeared. On the other side, the Bill is already named in the King’s Speech, and a new Prime Minister has just given the levy a start date. None of the three slow cases had that at the same point. Our market opens a little below evens.

The record is also small, with five cases, and the three slow ones took fourteen, fifteen and twenty-one months to reach a first reading.

The sign to watch is the consultation response, which should come before the Bill. In 2010 the response and the Bill came on consecutive days. A response by the end of September would put this levy on the fast path, and no response by the Budget on would put it on the slow one. A levy that starts at the end of 2027-28 also needs an Act, regulations and a decision by a mayor before then.

Disclaimer

Hunch works only from sources that are publicly available, and publishes on the basis of analysis of that material. We do not form an editorial opinion or take sides, we give a simpler and wider view of news that already exists. If information in a source we used was inaccurate, distorted, or later disputed but had already entered our analysis, Hunch accepts no liability for that. Predictions are not advice. Phase 1 markets use Hunch Points, not money.

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