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Bed tax will drive our tourists away; Holidays will cost more and we will lose millions in Wales businesses warn.

Byline: By DAVID JONES Business Correspondent

TOURISM businesses in North Wales fear a suggested "bed tax" on visitors to the area could knock the industry for six and lose them millions of pounds.

Estimates suggest that such a bed tax could add 10% to the cost of a holiday in the region - an extra charge that hotel operators would inevitably have to pass on to customers.

The proposed levy could add as much as pounds 100 to the cost of a week's family holiday and severely hamper efforts by hotels and B&Bs in resorts such as Rhyl and Llandudno to compete against rival operators such as budget airlines offering cheap flights to Continental holiday destinations.

Guests in hotels and bed and breakfast establishments would be charged for overnight stays - with the extra money paid being used to supplement existing local taxation revenue streams.

North Wales Tourism, which represents more than 1,300 tourist operators in the region, is so alarmed at the prospect of the new tax that it is writing to all local MPs to enlist their support in fighting the plan.

It is also organising a petition to be signed by tourist businesses in the area protesting against the imposition of a new charge on the industry.

The organisation's managing director Esther Roberts admitted tourism businesses were worried: "The impact of a bed tax would not be confined to accommodation providers - it would also hit tourist attractions in the area if visitor numbers drop.

"It would severely impact on the pounds 500m industry in North Wales where micro-businesses are the mainstay of the economy."

The Federation of Small Businesses in North Wales is also backing calls for the rejection of plans to impose a bed tax on tourists.

North Wales FSB chairman Gwyn Evans said: "We are already charging tourists who visit this country 17 1/2 % VAT on their accommodation compared to an average of 8 1/2 % in the rest of the European Union.

"Now it is proposed to clout them with an additional tax of up to 10%. If politicians think this will encourage tourists to visit North Wales and help the tourism industry, they are dreaming."

A Welsh Assembly Government spokesman said: "The review of local government funding by Sir Michael Lyons is yet to conclude. It would therefore be inappropriate to comment on speculation about what may or may not be included in the final report, particularly as the review only covers local government finance in England."

But FSB North Wales regional organiser Mike Learmond said there was a growing belief that a bed tax will be introduced first in England and then in Wales.

He said: "What I find amazing is that at a time when the Assembly Government is spending thousands of pounds through Visit Wales and other initiatives to encourage visitors, politicians are thinking about slapping a bed tax on the industry which can only act as a disincentive for people to come here."
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Title Annotation:Business
Publication:Daily Post (Liverpool, England)
Geographic Code:4EUUK
Date:Aug 23, 2006
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