The Visit Mull and Iona Steering Group has sent a letter to all Argyll and Bute Councillors and other relevant parties which is a representation of the views and concerns of many of our members.with regard to the draft scheme for a Visitor Levy for Argyll and Bute. For the details of all those contacted please email admin@visitmullandiona.co.uk
The proposed Visitor Levy for Argyll and Bute
Visit Mull and Iona Destination Management Organisation (VMI) is writing to highlight the following issues on the proposed Visitor Levy, as raised by our members. Whilst many of our members disagree with the principle of a Visitor Levy for Argyll and Bute, this letter is focussing strongly on the specific negative effects of a Visitor Levy on the visitor economy and community of Mull and Iona.
1: The negative impact of the addition of a Visitor Levy on the turnover of the accommodation sector
Living and running a business on an island has more challenges and is more expensive compared to the mainland. The majority of accommodation businesses on the islands are small and often operate just below the VAT threshold. Despite the Levy not being income, it is to be added to turnover figures for reporting to HMRC, forcing some businesses to become VAT registered, with the associated added increase in price and administrative burden. Some accommodation providers may be forced to reduce their prices to be able to fund the Levy, whilst staying below the VAT threshold and remaining competitive with the rest of Scotland. This will have unacceptable repercussions on island businesses and the fragile economy of Mull and Iona.
2: The Visitor Levy will exacerbate the downturn of the Mull and Iona visitor economy
Mull and Iona depend very highly on visitors for their economy, which has suffered a series of setbacks in recent years. Since Covid, some businesses which closed have not re-opened and income lost in the tourism sector is still being felt. The Islands are still recovering from a lack of the return of overseas visitors; meanwhile the domestic market is weak due to the cost of living. Accommodation businesses are struggling and already several have closed due to the costs and burden of the short term let licence. VMI accommodation members are reporting a downturn in income for the 2024 season of between 12% – 16%. Any further downsizing or closure of accommodation businesses due to the Visitor Levy will have a multiplier negative effect through all hospitality sectors as well as all the business sectors that rely on them. This is clearly not the time to introduce a Visitor Levy to Mull and Iona.
3: The Visitor Levy is not appropriate to particular aspects of the visitor economy of Mull and Iona
The Visitor Levy is less punitive to forms of tourism that have associated problems due to the pressure they put on fragile island infrastructure, whilst punishing lower-intensity, longer-staying, visitors. This has not been considered by Argyll and Bute Council.
Due to its proximity to the mainland, Mull already receives a high number of day visitors, which puts a strain on the road infrastructure. With day visitors not having to pay a Levy, day visits would increase, with less incentive for visitors to stay overnight.
Cruise ships are excluded from the Levy, despite being a potential valuable source of income and a way of managing the overcrowding which affect the quality of residents’ lives when a cruise ship visits.
Having no Levy on motorhomes would encourage “wild camping” rather than using camping sites, which will charge a Levy; a negative for the environment and an income loss for the campsites.
4: A Visitor Levy is not appropriate for Mull and Iona given the standard of the ferry infrastructure to provide a reliable service to visitors
The ferry service has been failing badly since 2019, before becoming a crisis in the summer of 2023, which has caused immense problems for the visitor economy as well as residents lives. A lack of confidence in the ferry service continues to affect visitor numbers and the Mull and Iona economy. A Visitor Levy will make a visit to the islands more unattractive.
5: The spend on improvements on Mull and Iona from a Visitor Levy should be commensurate with the income from it
Mull and Iona have a high level of visitors, with the associated negative impacts on infrastructure that this brings. Levy income from Mull and Iona should be fully invested back into the local area, not spread throughout Argyll as proposed. A Levy income which is not ring-fenced to offset the impacts of tourism will make the islands less attractive to visitors.
6: The financial impact on Island residents having to pay the Visitor Levy is unfair
Due to the time requirements of travelling off an island, Mull and Iona residents will suffer increased cost of living by having to pay the Levy when they book an essential overnight stay in Mull, Oban or other areas, for health visits, to visit their children at Oban High School, go to funerals and many other reasons for travel that can normally be achieved in one day for those who don’t live on an island. The increase in cancelled ferries due to the failing ferry infrastructure has increased the need for unplanned overnight stays in Oban and on Mull for residents which would become even more expensive. A Visitor Levy should not apply to island residents.
7: Argyll and Bute Council should not make a decision on whether a Visitor Levy is appropriate for Mull and Iona without a feasibility study on the impacts of the Levy
There are no formal statistics for Mull and Iona’s tourism, which is very different from that of Argyll and Bute as a whole. Orkney, Shetland and the Western Isles are jointly taking part in a feasibility study with a cost-benefit analysis on the Visitor Levy for their areas. Argyll and Bute Council cannot make a decision that a Visitor Levy is appropriate for the islands without a feasibility study.
8: The administrative burden of the Visitor Levy should not be on accommodation businesses
It is unfair that accommodation businesses are having the extra work of administering the Visitor Levy on top of all the other challenges they face. VMI are certain some of our members will decide to close their business, adding to the economic downturn of the visitor economy. Since Argyll and Bute Council will be the beneficiary of the Levy, they cannot introduce a Levy before providing the platform for, and administering, the collection of the Levy.
9: If Argyll and Bute Council decide to adopt the Levy they will be less competitive in the Scottish marketplace
Councils that have opted out from the Visitor Levy will have a bigger appeal to visitors than those that opt in, promoting their area as visitor-welcoming and affordable, and positioning Argyll and Bute businesses at a competitive disadvantage.
10: The August 2024 Visitor Levy Survey is not valid
The Visitor Levy survey by Argyll and Bute Council in August 2024 was poorly designed and in insufficient depth to provide data to take the decision to proceed with a Visitor Levy. There was no question in the survey on whether the respondent was in favour or not of a Levy. Promotion & communication by the Council of the survey, and the proposal to introduce a Visitor Levy, was inadequate, as was the number of responses gathered, to be a true indication of the views of those who would be affected by a Visitor Levy. Argyll and Bute Council should revisit whether a Visitor Levy is appropriate to Argyll and Bute Council with those who will be impacted, especially as its area includes islands.
Given the very high number of issues raised by our members, demonstrating that the introduction of a Visitor Levy would be damaging for both the Mull and Iona and the Argyll and Bute visitor economy, we request that Argyll and Bute Council should not approve or agree the draft Visitor Levy scheme which will go to the Council for consultation on the 20th December 2024.
Visit Mull and Iona DMO Steering Group
