CITY leader Jenny Dawe has thrown her support behind controversial plans to introduce a bed tax for visitors to Edinburgh.
In a move which puts the idea back on the agenda, the Lib Dem leader said the extra money would be "very useful" for the city.
The proposal involves adding a charge of about 2 per cent to hotel bills, to raise extra cash for major tourism initiat
ives. The cash would be ringfenced to help pay for festivals, events and marketing ventures – a principle commonplace in Europe and America.
SNP councillor Tom Buchanan, the city's economic development leader, supports the scheme, but many hoteliers are against it.
The Edinburgh Principal Hotels Association (EPHA), which represents some of the main hotels in the Capital, last month declared the plans "dead in the water".
But Cllr Dawe's intervention – under questioning from the Tories – shows the debate is not over.
"I'm personally in favour of the transient visitor levy (TVL), or bed tax by another name" she said. "Nobody would really notice it, but it could bring in a very useful bit of money." Recent studies indicate that Edinburgh faces increasing competition from other cities to attract tourists.
Pete Irvine, creator of the city's Hogmanay celebrations, believes money raised from visitors staying in the city should be ringfenced for the New Year budget.
Research has found that the TVL, which has been hugely successful in Vancouver, could generate an extra £3.2 million a year to supplement any national funding.
However, there is growing opposition from leading industry figures amid concern about damage to Edinburgh's reputation.
For the project to work, it is likely to need the support of tourism chiefs. Simon Williams, head of the EPHA, said: "The association is saying this is something it's not looking to consider."
David Hinnrichs, from the Edinburgh Hotel and Guesthouse Association, who runs the Allison Guesthouse in Newington, added: "The majority of hoteliers are against it right now, but a lot more information is needed.
"Edinburgh has to come up with more finance for tourism, and I don't know how we take that forward. I'm not totally against a levy – though I'd like us to look at other ways of finding money first."
Mr Hinnrichs said a levy on small bed-and-breakfasts might be unfair, but tourists already paying £250 for a hotel bed would be unlikely to notice the increase.
Tory Fountainbridge and Craiglockhart councillor Gordon Buchan, who challenged Cllr Dawe on the issue, said he was concerned a bed tax would put people off visiting the city.
"It would make Edinburgh a less attractive place for tourists," he said. "With the credit crunch, we need to make sure Edinburgh is as attractive for foreign and domestic visitors as possible."
