Visitor levy
A visitor levy is a charge added to overnight stays in paid accommodation, set and collected locally rather than nationally. It is also called a tourist tax, city tax or bed tax depending on the country.
Levies are usually charged per person per night rather than per room or as a percentage of the rate. That distinction is what makes them awkward operationally: a PMS that thinks in rooms has to count heads instead.
Most schemes carry exemptions, and the common ones are:
- Guests under a set age, often 18
- Stays beyond a maximum length, often around 30 nights
- People housed in an emergency or under a statutory duty
- Sometimes residents of the charging area
What it means for your systems
A levy is not a rate change, so treating it as one causes problems downstream. Practical requirements usually include:
- Calculating the charge per guest per night, applying exemptions automatically
- Posting it to the folio as a separate line, not as room revenue, so it is not treated as commissionable
- Handling any sales tax or VAT charged on top of the levy
- Showing it correctly on OTA bookings, where the channel controls how a supplementary fee is displayed and whether it is collected at booking or on arrival
- Producing a return the collecting authority will accept, on their schedule
Where they apply
Levies are long established across much of Europe, including Italy, France, Spain, the Netherlands, Germany and Austria, and increasingly in the UK. Scotland's Visitor Levy (Scotland) Act 2024 lets Scottish councils introduce one, and Wales' Visitor Accommodation Act 2025 does the same for Welsh authorities. In both cases each council decides individually, so whether you charge one depends on your address rather than your country.
Because adoption is council by council, an operator with properties in several areas can be charging different amounts, on different schedules, with different exemptions, from the same system.