UK tourism could collapse under Government's new 'holiday levy' - as industry is 'taxed out of existence'

By ELIZABETH IVENS FOR THE MAIL ON SUNDAY Published: 00:18, 17 May 2026 | Updated: 00:28, 17 May 2026 Tourism in Britain is 'being taxed out of existence' and could collapse under the Government's proposed 'holiday levy', a lettings boss has warned. Kate Allen, who runs Finest Stays in South Devon, condemned the move – announced in the King's speech last week – as 'just another stealth tax'. The Overnight Visitor Levy will allow officials to introduce extra payments on bookings, with fears it could add as much as £140 to a two-week stay for a family of five. Ms Allen told The Mail on Sunday the hospitality sector was already 'taxed to high heaven' and warned it could be 'catastrophic' for holiday destinations such as Devon and Cornwall, which were already fighting for business.  And she joined other tourism bosses in saying it was disingenuous of the Government to point to the example of Amsterdam and Paris, where a holiday or tourist tax has already been levied. 'We pay double the VAT of our European competitors. When you talk about visitor levy and you go abroad, it has a different impact on the industry,' she said. 'We are already taxed to high heaven.'  She also criticised vague plans for how the tax would be levied, saying: 'I don't think they have worked out how it is going to be charged – whether it is a percentage of the rental price or a per person or per room, per night situation because we are dealing with very expensive holiday lets and a percentage would be catastrophic.' Tourism in Britain is 'being taxed out of existence' and could collapse under the Government's proposed 'holiday levy', a lettings boss has warned. Pictured: Bayard's Cove, Dartmouth, Devon With a recent UK Hospitality poll finding the tax would reduce the chance of 73 per cent of people going on holiday, Ian White, from StayBlackpool.com, suggested any new levy would be 'more than the straw that breaks the camel's back'.  He added that businesses were already struggling to fill rooms because of 'more than 500' unregulated lettings in the town.  In Cornwall, tourism operator Peter Robinson, from Enjoy Fowey, said bookings were already down 16 per cent year on year and any additional tax would inevitably 'increase the cost of holidays for hard-up families'.  He added: 'It's quite difficult for businesses to attract people already.  'This is going to add to the difficulties of us in Cornwall competing with people flying to Tenerife.' Debbie Walker, from the Holiday & Residential Parks Association, suggested a per person per night levy could add as much as £140 to a two-week holiday for a family of five.  She added: 'While we fully recognise the financial pressures facing local authorities, a holiday tax adding around £100 to a typical family two-week break is not the right solution.' No comments have so far been submitted. Why not be the first to send us your thoughts, or debate this issue live on our message boards. By posting your comment you agree to our house rules. Do you want to automatically post your MailOnline comments to your Facebook Timeline? Your comment will be posted to MailOnline as usual. Do you want to automatically post your MailOnline comments to your Facebook Timeline? Your comment will be posted to MailOnline as usual We will automatically post your comment and a link to the news story to your Facebook timeline at the same time it is posted on MailOnline. To do this we will link your MailOnline account with your Facebook account. We’ll ask you to confirm this for your first post to Facebook. You can choose on each post whether you would like it to be posted to Facebook. Your details from Facebook will be used to provide you with tailored content, marketing and ads in line with our Privacy Policy.