A tourist tax for overnight stays may be introduced in UK towns and cities, as new powers have been granted to local leaders in the latest Budget.
Through changes enabled by the Autumn Budget 2025, city mayors and town officials will have the authority to charge a small fee for overnight stays in accommodations such as hotels, B&Bs, guesthouses and holiday lets.
These levies will bring England in line with other parts of the UK, as well as with top international destinations such as New York, Paris and Milan, where fees on short-term stays have long been commonplace.
On the UK Government website, Steve Reed, Secretary of State for Housing, Communities and Local Government said: ‘Tourists travel from near and far to visit England’s brilliant cities and regions.
‘We’re giving our mayors powers to harness this and put more money into local priorities, so they can keep driving growth and investing in these communities for years to come.’
Currently, it’s entirely up to mayors and other local leaders to introduce a modest charge if they feel it’s right for their area.
With England alone attracting over 130 million overnight stays per year, it’s thought the money raised through tourist taxes could help fund local projects that improve transport services and infrastructure, which, in essence, could attract more visitors.
In London, some of the city’s busiest tourist hotspots have been calling for measures to better benefit from visitors and improve life for residents while supporting smaller businesses.
A fee for overnight stays may be implemented in towns and cities across the UK, as new powers have been granted to local leaders in the government’s Autumn Budget 2025 (Pictured: Brixton, London)
Officials in Lambeth, London, home to some of the capital’s busiest areas, like Clapham (pictured), have been calling an for overnight tourist tax to help improve the community
South London Council, Lambeth, is proposing an overnight levy that will not only contribute to the local community, but help manage tourism impacts.
The borough includes the bustling areas of Brixton, Clapham, Vauxhall, Streatham and Norwood, which have become popular with young professionals and tourists in recent years thanks to some hip markets, vibrant bars and impressive food scene.
And the South Bank, which includes major attractions, like London Eye, the National Theatre and the Southbank Centre, is in Lambeth too.
The area draws tens of millions of people each year – with around 200,000 visitors staying overnight.
In online petition, Lambeth Labour said: ‘We’re incredibly proud of this, and we want to do everything we can as a council to expand and strengthen our borough as a leading destination to visit and live in.
‘The revenue from what Lambeth Labour calls the “Love Lambeth Levy” could be allocated towards public realm improvements, such as street cleaning and general upkeep and maintenance of the borough and promote Lambeth as a leading destination to visit and enjoy.’
Officials in Bolton and across Greater Manchester have also expressed interest in implementing the levy, with Mayor of Greater Manchester, Andy Burnham, calling it ‘a measure we have long called for’.
Speaking to Bolton News, he said: ‘Greater Manchester already has a thriving visitor economy, and a visitor levy will help us sustain good growth over the next decade.’
Officials in Bolton (pictured) and across Greater Manchester have also expressed interest in introducing a tourist tax
Mayor of Greater Manchester, Andy Burnham, is seeking to implement a compulsory tourist tax in Manchester City Centre (pictured) ahead of the Euro 2028 Championship
Since its introduction in April 2023, visitors staying in Manchester city centre have been paying a £1-per-night ‘city visitor charge,’ which goes towards funding street cleaning and other services.
The fee is technically voluntary, but because guests must actively choose to opt-out, most contribute, and the scheme raised £2.8million in the first year.
According to Manchester Evening News, Mr Burnham said he wants a compulsory tourist tax to be in place ahead of the Euro 2028 Championship, with England’s players set to kick off their campaign at Manchester’s Etihad Stadium.
The Government has also suggested Liverpool could benefit from the levy, which could help improve infrastructure and support major events that drive visitors – such as the Euro 2028 Championship.
Businesses, communities and others with an interest in the measure can have their say on how it should work, with a consultation running for 12 weeks.
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