Meeting of the Parliament 19 February 2026 [Draft]
First, I want to respond to Willie Rennie—ever the father of the house—giving us that guidance on bells and whistles. I have to throw a tantrum and tell him that I like bells and whistles and I want to put lots of things into this vital bill. However, I thank him for his advice.
When the Visitor Levy (Scotland) Bill was introduced, we on the Conservative benches made it clear that we did not believe that introducing a visitor tax was the right approach for Scotland, and certainly not for fragile rural and island economies. However, once it became clear that that bill would proceed despite our efforts to advise the Parliament otherwise, our focus shifted to making the simple point that, if a levy was going to exist, it must be as flexible and workable as possible for the businesses that would be expected to collect it.
The correspondence that I received from businesses on Mull, Skye and across the Highlands and Islands paints a worrying picture. One long-established island business told me:
“We cannot rely on loyalty to the Scottish brand when families themselves are struggling with the cost of living.”
Another business said:
“2025 was the slowest year for bookings we have ever experienced, with large gaps in summer availability for the second year running. That is before any levy has been introduced.”
Great work has been by many regional campaigners, all of which I commend. The Skye and Lochalsh business impact survey got many responses, including one that said:
“If the levy tips us over the VAT threshold, we could lose £15,000 to £20,000 a year. That is not marginal—that is business changing.”
Clearly, businesses were very worried from the outset.
The Association of Scotland’s Self-Caterers, which does an incredible job, has consistently highlighted the risk to small operators, particularly those that are close to the VAT threshold, and the disproportionate administrative burden.
In the Highlands, the issue is not just about hotel chains. There are many farmers who are diversifying, island families with mortgages, and microbusinesses that are already having to cope with ferry disruption, labour shortages and rising costs.
Those of us on the Conservative benches know that if a levy is to function, it must be flexible. First, councils must have the ability to set a flat rate per night. In many rural areas, a modest fixed amount of £1 or £2 would be far more proportionate and predictable than a percentage-based charge that would penalise people booking longer stays or higher-quality accommodation.
Secondly, there must be clarity on who pays. If policy makers believe that the levy should focus on international tourism, the legislation must allow, for example, island residents who are travelling for medical appointments or families who are forced to stay overnight because of cancelled ferries not to be caught by a blunt instrument that would affect them, too.
Thirdly, the administrative burden must be minimal. It is not reasonable to expect busy small businesses to become unpaid tax collectors for the Government without clear systems, clarity on VAT treatment and proper cost recovery.
I remain of the view that the Highlands and Islands are fundamentally different from large cities such as Edinburgh. Our economies are seasonal, fragile and highly dependent on repeat visitors and community good will. A one-size-fits-all approach does not always work. That is why the proposed legislation is welcome. It improves flexibility and addresses some of the concerns that we have raised from the outset. We never wanted the levy but, if it exists, it must be workable.
Despite my opposition to the visitor levy, I am thankful that the minister listened to the Scottish Conservatives. Murdo Fraser said that we were there to hold Ivan McKee’s hand. We held his hand and enabled him to bring the legislation back to Parliament. If the minister needs his hand held with mistakes on other matters, such as non-domestic rates or the budget, he should come to us. We will be there to help him at any point.
Last year, 1,000 people signed my open letter to the minister. All they said that they wanted were certainty, fairness and common sense, and that is what we will continue to ask for. I am glad that the bill is here today.