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I should explain the primary purpose of amendment 28, in my name, because it might not be entirely clear.

Amendment 28 caps the number of nights to which the visitor levy would apply. As a member who represents an Edinburgh constituency, the key point for me is that, during the festivals in the summer, a large number of people use accommodation such as hotels but come here to work, provide their services and be part of the festivals. It strikes me that when people use accommodation beyond a certain number of nights, it ceases to be temporary and they cease to be visitors because they are here to work.

A threshold for the number of nights would be a simple way of providing an exemption for people who visit a place semi-permanently to work. It avoids the complexity of trying to come up with definitions and it is just a simple number. Amendment 28 is a probing amendment to explore how we would treat people who are here either for particular purposes or to service the tourism and visitor economy.

I will address the points that Miles Briggs raised. It is fair to say that, among local authorities and the business community, there are mixed views regarding whether a percentage rate or flat fee should apply. I have spoken to business organisations that have said that they have members who argue both sides. However, the arguments that Miles Briggs made have some merit.

There would be a considerable degree of additional simplicity to having a flat fee. When you apply a flat fee, it is simply a matter of multiplying it by the number of rooms that have been occupied over a given period. The complexity of having a percentage is not to be underestimated, not just for the reasons that Mr Briggs set out around additional charges, but also because the vast majority of accommodation providers will have variable rates, which means that some quite complicated record keeping and administration would be required. That needs to be thought through.

The other point is that there should be a degree of consistency, so that the system is understandable. The last thing that we want is 32 varieties of visitor levy, which would make the situation complicated and confusing for visitors who go to a number of places during their time in Scotland. It is important that there is local discretion around the levy—it should be a levy that is locally devised and implemented—but we should also look at ways to ensure that there is a degree of consistency in order to improve the ease of understanding of the system.

On the flipside of that—because there are opposing views on the matter—I note that the moment that you have a flat fee, you get into the complexity of how that is increased and administered, and all the issues that arise when there are fixed rates in law, such as fiscal drag and so on, which we are all aware of. Having spoken to colleagues in local authorities, I know that they are concerned that, if there were to be a flat rate, they would get into a continual debate—annually, or whenever the issue is reviewed—about what the fee should be. That is the argument for using a percentage rate.

Using percentages is inherently more complicated than other approaches—VAT is a non-trivial tax to collect, administer and police in order to verify that people are paying the correct amount. We should be careful about the complexity that using a percentage fee causes in the system that we are creating.

Finally, we need to think about how we treat people who are here to—

Of course.

I want to highlight two brief points. First, I recognise the issue of motorhomes, but a basic principle is that it is not always possible to tell who is staying where, regardless of the type of accommodation. We have to assume that people will be honest. I do not consider a motorhome per se to be different from any other type of accommodation.

Secondly, in not making liable for the levy vessels that are moored that provide accommodation, or vehicles that are parked up that provide accommodation, there is a risk that certain types of accommodation will not have the levy applied to them, whereas others will.

Does the minister acknowledge that that potential loophole needs to be thought about at stage 2 and, ultimately, stage 3, to ensure that there are no significant areas in which people can provide accommodation without being liable for the levy?

I note the minister’s comments about previous amendments. In relation to amendment 42, however, will the Government consider explicitly requiring local authorities, as they develop and deploy their plans for local levies, to consider small businesses and VAT thresholds? Such consideration could be required as part of the impact assessments under the bill.

That may well be an error on my part. Amendment 28 is a probing amendment. The key point is to ensure that we treat people who are here to do work in a different manner to the way in which we treat people who are here to partake in tourism.

My fellow commission members will be relieved to hear that I will not go through appendix 1 line by line.

I understand what most of the line items are, but what is contained in “Other accommodation Costs”? There has been an increase in those costs of more than £100,000, from £445,000 to £592,000, in a single year. What do those costs include, given that they do not relate to “Rent & Rates” or “Travel & Subsistence”?

I want to pick up on that and to re-emphasise the point that the chair made. In the coming financial year, the public sector financial settlements are likely to be extremely challenging. In that context, 8.4 per cent will be difficult to justify in comparison with other public sector bodies. A point has just been made about essentially living by the guidance that you provide to public sector bodies. Is making that statement not inviting at least that challenge?

How many additional public bodies will you have to audit in the coming financial year compared with the current year?

Thank you.

Yes, please.