Seòmar agus comataidhean

I appreciate that. I will not press or move the amendments in this group.

Amendment 14, by agreement, withdrawn.

Amendments 15 to 18 not moved.

Again, I am aware of what the 2024 act says, but I am also aware of what the practice means. I think that the minister knows exactly where I might be coming from, in respect of the operation of government. At all levels, there are reviews and reports. These things roll up—

I apologise to you all for having to listen at length to my voice this afternoon, but there we go.

Amendments 20 to 22 deal with exemptions. That subject might sound like a technical corner of the bill, but, in truth, it goes to fairness, proportionality and, I think, common sense.

A visitor levy is designed to apply to people who choose to travel for leisure or business and who make discretionary use of overnight accommodation. That is the underlying rationale. It follows that there are categories of stay that do not sit comfortably within that rationale and that should not automatically be treated as though they do.

There are circumstances in which individuals stay away from home not by choice but by necessity. Such circumstances may involve medical treatment, emergency displacement, domestic crisis or other forms of vulnerability, or they may involve carers or family members supporting someone in hospital. To treat those stays in precisely the same way as a weekend break or a short city stay is to ignore context.

Amendments 20 to 22 seek to ensure that local authorities will be required to consider, and, where appropriate, to provide clear exemptions for, categories of stay that are fundamentally different in character from tourism. My amendments are not about creating loopholes; they are about recognising that not every overnight stay is a holiday and that not every occupant is a tourist in any meaningful sense.

There is also a practical dimension. If we do not define exemptions carefully, we risk creating inconsistency across Scotland, which could generate confusion for accommodation providers, uneven treatment for individuals and reputational harm to the policy itself.

Clear statutory guardrails would reduce that risk and give councils a framework within which to act sensibly. I am seeking not to undermine local flexibility but to empower it. Councils should retain discretion within a defined structure, but discretion must operate within principles. Those principles include fairness to those in vulnerable situations and clarity for those who must administer the scheme.

If the levy is to command broad public consent, it must be seen to be targeted and proportionate. It should not fall on those who are already under strain and who have little genuine choice about their circumstances. Amendments 20 to 22 are designed to embed that principle in the bill. They are about getting the edges of the scheme right, aligning the levy with its stated purpose and avoiding avoidable hardship. I ask colleagues to support amendments 20 to 22.

I move amendment 20.

15:45

Amendment 13 is about responsible flexibility. The bill—quite rightly—extends the scope for local authorities to modify their visitor levy schemes. That is consistent with the principle of local discretion, but discretion must sit alongside discipline. When a council proposes to modify a scheme in a way that increases the rate of the levy, that is not a minor technical adjustment; it has real-world consequences for accommodation providers, for pricing, for competitiveness and, ultimately, for visitor behaviour.

Amendment 13 would simply require that such a step is accompanied by a clear and transparent assessment of business impact. Tourism in Scotland is dominated by small and medium-sized enterprises. Many such businesses are family run and many operate seasonally. Many, particularly in rural and island areas, face structural cost pressures that their urban counterparts do not. An increase that looks modest on paper may be material in practice.

At stage 1, we heard evidence that some councils paused their schemes in the light of concerns about implementation and proportionality. That was not obstruction; it was evidence of responsiveness.

Amendment 13 would build that responsiveness into statute by ensuring that any increase is based on evidence and publicly justified. It would not prevent a council from increasing the levy. If the case is strong and the impact manageable, the evidence will demonstrate that. It would prevent an increase being made without a structured understanding of an economic impact. That is good governance. It strengthens accountability and gives businesses clarity and confidence that changes will not be made lightly.

If the levy is to endure, it must command on-going consent. Consent depends on transparency and proportionality. Amendment 13 reinforces both, and I invite colleagues to support it.

I will confine my remarks to amendment 12, which is about recognising something that ought to be self-evident—that Scotland is not economically uniform. A policy lever that operates comfortably in a major city does not always operate in the same way in a rural county or on an island.

We speak often in the Parliament about island proofing and about the distinctive pressures that rural Scotland faces. Those are not abstract concepts; they reflect higher transport costs, shorter tourism seasons, smaller labour pools and businesses that operate on very tight margins. In many of those communities, tourism is not simply a part of the economy; it is the backbone of the local economy.

A visitor levy might be sustainable in high-volume, year-round urban markets. In a small island community or a remote rural area, where visitor numbers fluctuate and price sensitivity is acute, the same levy can have a different effect altogether. The difference between resilience and fragility can be narrow.

Amendment 12 would not create an exemption, and it would not prevent a local authority from applying or modifying a levy in rural or island areas. It would require that, before doing so, there is an explicit assessment of the likely economic and community impact in those areas and that the reasoning is set out clearly. That is not burdensome—it is about disciplined decision making and transparency. It would ensure that local flexibility is exercised with a proper understanding of local context.

I repeat that, at stage 1, we heard that some councils had paused their visitor levy schemes in the light of representations from businesses. That was not weakness—it was responsiveness. Amendment 12 would build that responsiveness into the structure of the legislation. It would encourage councils to ask the hard questions in advance rather than dealing with unintended consequences later. One could argue that we are here discussing the bill because of unintended consequences that we should have picked up and dealt with earlier.

If we are serious about fairness and proportionality, rural and island Scotland cannot be an afterthought in a national framework. Amendment 12 reflects that simple proposition, and I invite colleagues to support it.

I move amendment 12.

Amendment 19 is about discipline—the kind of discipline that many of us feel was baked into the operation of this Parliament through post-legislative scrutiny. The amendment is about scrutiny and ensuring that, once a visitor levy scheme is introduced, it will not simply roll on by default, untouched by reflection or reassessment.

We have spent a great deal of time debating the design of schemes, the calculation of the levy and the impact that the levy will have on different sectors and communities. It is right to do that scrutiny in this part of the legislative process, but scrutiny cannot end at the point of the levy’s introduction. If the levy is to be credible, it must be subject to meaningful review and, where appropriate, expiry. Local authorities operate in changing circumstances, visitor patterns shift, economic conditions fluctuate and community sentiment evolves. A scheme that appears proportionate at the outset may look different three, five or seven years on.

Amendment 19 would amend section 21 of the 2024 act to say that the three-yearly review of schemes

“must include a decision on whether the VL scheme should continue or expire.”

This would provide a clear statutory mechanism to require a structured review and, crucially, the possibility that a scheme would lapse unless it was actively renewed on the basis of evidence.

When taking money from taxpayers, it is essential that taxes are not introduced or maintained just because they are an easy source of money or a way to avoid hard choices. Money should be taken by Governments only where absolutely necessary. Amendment 19 would force councils to continually ask themselves, “Is this levy still achieving its stated objectives? Are proceeds being used in a way that delivers tangible benefit? Has the impact on businesses been as anticipated, or are adjustments required?”

Without such a mechanism, there is a risk that schemes will become embedded as part of the fiscal landscape, insulated from challenge and divorced from their original purpose—that is something that happens. That would undermine trust and weaken the incentive to demonstrate value for money.

Amendment 19 would not compel a council to end a successful scheme. If the evidence showed that a scheme was working, enjoyed support and delivered for the visitor economy and the host community, renewal should be straightforward. Instead, the amendment would prevent complacency.

Amendment 19 also aligns with the broader principle that taxation, even at the local level, must be justified on an on-going basis. In a fragile sector, where margins are tight and competitiveness matters, that principle is particularly important. If we are asking businesses to collect the levy and visitors to pay it, we owe them more than a one-off justification. We owe them periodic and transparent revaluation. Amendment 19 would ensure that that happened, and I invite colleagues to support it.

I move amendment 19.

I want to check that I understand what you are saying, minister. Are you saying that the idea is sound, but that the implementation of proposed new subsection 21(2)(2B) of the 2024 act would be too severe, and that we would need to work on a different set of words and a different process around how the scheme would expire?

I have no further comments to make, but, on reflection, I will take amendments 20 to 22 away and consider whether I should re-present them with a more convincing argument at stage 3. I seek to withdraw amendment 20.

Amendment 20, by agreement, withdrawn.

Amendments 21 to 27 not moved.

I am sure that you will be pleased to hear that this is my last amendment.

Amendment 29 seeks to address an issue that may appear to be secondary, but which, in practice, will shape how the levy is experienced on the ground. It concerns penalties and the circumstances in which they may be imposed.

The visitor levy places accommodation providers in a new position. They are no longer simply businesses operating in a market; in effect, they become tax collectors on behalf of the local authority. They must calculate, record, return and remit sums accurately and on time. That is an administrative burden, particularly for small operators that do not have in-house compliance teams or specialist finance staff.

The 2024 act already contains an extensive framework for enforcement and penalties. That framework is detailed and, in some respects, robust. Amendment 29 is not an attempt to weaken enforcement or to excuse deliberate non-compliance; it is about ensuring that penalties are proportionate and consistent, and that they are used as a last resort rather than a first response.

In the early years of the new scheme, errors will occur, systems will take time to bed in and guidance will evolve. If the default position of enforcement is punitive rather than supportive, we risk damaging the very sector that is being asked to administer the levy. A penalty regime that does not distinguish clearly between wilful evasion and an honest mistake will undermine trust and co-operation.

Amendment 29 therefore seeks to narrow and clarify the circumstances in which penalties may be imposed, reinforcing the principle that councils should prioritise guidance, engagement and rectification before sanction. It seeks to strengthen the expectation that reasonable excuses and good-faith compliance will be taken seriously. That approach is not soft; it is sensible.

Effective tax systems, whether national or local, depend on voluntary compliance, and voluntary compliance depends on clarity, fairness and a perception that enforcement is measured.

The heavy-handed use of penalties risks having the opposite effect. We are asking thousands of small and medium-sized enterprises—some of them are microbusinesses—to shoulder new responsibilities. Many of them will do so diligently, and they deserve a system that recognises the reality that they are working with.

Amendment 29 would not remove the ability of local authorities to act decisively where there is abuse or deliberate non-payment; it would simply set a tone of proportionality and fairness. If we want the levy to work in practice, not just on paper or as a theory, the tone matters. I therefore ask colleagues to support the amendment.

I move amendment 29.

I intervened on the minister because I thought that he had found something in the substance of my amendment 12 that he felt was lacking and that could be attended to before we got to stage 3. However, the closer I listened to him, the more I realised—unless he intervenes now—that he was objecting to the very principle of amendment 12. I intend to press the amendment.

I hope that my colleague Tim Eagle will move amendment 30, because the minister has indicated that he will accept it, subject to lodging his own amendment, which is a welcome move on his part.

I press amendment 12.