Accommodation proprietors in the capital could be forced to spend “millions of pounds” on manually calculating the council’s visitor levy, as online booking platforms struggle to catch up to the new rules.
According to the Scottish Tourism Alliance (STA), proprietors have reported that manually calculating the levy can take up to eight minutes at a time, for each booking.
One Edinburgh business owner involved in the scheme explained why the new system has been confusing to work out.
He said: “Hotels often add on parking, dinner, breakfast, and laundry onto the overall accommodation bill. The levy should not be applied to those extras, but their systems can’t exclude those services from the levy calculation.
The tourist tax went into force on July 24. (Image: Ben Glasgow)
“As a result, it's a manual job for hotels to calculate, which takes about eight to 10 minutes per booking.”
The Herald understands that the council recently held a summit with businesses affected by the rules, which came into effect on July 24, 2026.
STA chief executive Marc Crothall said: “Some of the booking platforms are not yet set up to work with the percentage model properly and accurately remove non-accommodation elements from the final levy calculation, and that means businesses are having to go back and correct bills. That takes time, and it costs money.
“When you multiply that across the number of bookings being made in Edinburgh, it becomes a significant cost. This could run into millions of pounds, so we need to understand the true cost and whether the 2% businesses can retain for administration comes anywhere close to covering it.”
Another issue that some businesses have raised is whether the cost of commissions and fees for online booking platforms should be included in levy payments.
The Herald’s source said: “I am charging 5% on top of accommodation price via online travel agent (OTA) platforms, but I have conflicting guidance on what I should pay to council.
“Do I pay 5% on gross (which is what the council advises) or do I pay 5% on gross minus OTA commission and management fee (which reduces the gross value that the 5% levy is applied by a quarter).”
The business owner emailed Visit Scotland for guidance.
A response stated that the legislation setting out the visitor levy scheme did not specifically address OTA fees. Visit Scotland's official guidance states that “commission may or may not be included” in the overall charge.
“City of Edinburgh Council has set out in its guidance for businesses that commission should be included,” the email explains. “This is following consideration of our guidance and after taking their own legal advice.
