James Rusden, who operates Scarborough's Toulson Court bed and breakfast, has raised concerns that hospitality businesses in North Yorkshire will struggle to compete if a visitor levy is introduced in the region but not in neighbouring East Yorkshire.
A national consultation on the proposed levy concluded on 18 February 2026, with legislation anticipated later this year. The scheme would allow local authorities to charge visitors a nightly fee during their stays, with research suggesting a £2-per-night charge could generate up to £52 million annually for the region.
Rusden expressed frustration about the potential competitive disadvantage.
"If someone is coming to Scarborough but has to pay a levy each night, but can go to Bridlington where there's no levy, then that's where they'll go. It's unfair and it'll make it harder for us to compete."
He characterised the levy as
"a form of taxation"and warned that cost-of-living pressures already affecting visitor numbers would be compounded by an additional charge.
"People are short of money. To put a tax on them coming on holiday makes them think twice about where they go."
Rusden noted that North Bay bed and breakfasts had benefited from a record season at Scarborough's Open Air Theatre, which featured multiple sold-out performances. However, he said guests were already reducing their stays.
"People used to come for four or five nights, they're now knocking a night off. They just can't afford it."
The timing of any introduction was also a concern, he added, as households faced further energy bill increases alongside broader financial strain.
What would the levy fund?
York and North Yorkshire's elected Labour mayor David Skaith has positioned the visitor levy as transformative for the region.
"York and North Yorkshire is beautiful, with something for everyone. Millions of people visit every year."He stated that
"if we do get this right, we can invest in what makes our county a fantastic place to live and visit like never before."
However, Scarborough Town Council has formally objected to the proposed overnight visitor levy, escalating opposition from coastal communities concerned about the scheme's impact on local tourism.
A government spokesperson said:
"We're listening to businesses in Yorkshire and across the country on this so we make sure money raised is invested in local priorities."Ministers described the new mayoral powers as part of
"the biggest transfer of power, funding and responsibility from Westminster in a generation,"allowing local communities to benefit more directly from tourism revenue.
Prof Brendan Paddison, Dean of York St John University's business school and chair of York Tourism Advisory Board, highlighted the importance of industry involvement in the process. He said research at the university found a need to keep the tourism sector engaged in
"decision-making and governance processes"around any levy. He also noted that
"some of that funding that is perhaps raised through a levy is ring-fenced to support the industry and the work it does."
How do visitors view the proposal?
Responses from holidaymakers in Scarborough were mixed. Phil and Carol Smith, visiting from Derbyshire with their border terrier Logan, said they would continue visiting even with a levy in place. The couple, who married in Scarborough and visit at least three times yearly, considered the town their
"second home."Phil suggested a £1 to £2 nightly charge was negligible.
"I'd rather not pay it, but that's nothing. A pint of Guinness is almost six quid, what's a pound? We feel comfortable here, everyone's so friendly."
However, both questioned how the revenue would be spent, with Carol noting that
"Scarborough needed more public toilets"and additional seating areas.
"It's a busy town. Some more places to sit, and especially some more public toilets, would be money well spent."
Charlie Highnett, an East Yorkshire resident, took a different view. He said he would seek cheaper accommodation options to offset any levy costs, adding that
"it would be disappointing to pay any extra."He called for consistency across regions, stating
"if it is introduced it should be unified - not just one county."He emphasised the need for
"some alignment and joint decisions made."
Rod Fretwell, visiting from Bolton, supported the levy only if implemented nationally.
"If it singles out some businesses, like hotels and bed and breakfasts, and doesn't cover others, and it's not national - so you can go down the road and they don't charge it - then it shouldn't be done."
What opposition has emerged?
Four North Yorkshire MPs have called on the mayor to pause the process until detailed impact assessments and fuller engagement are completed, signalling growing political resistance to the scheme.
Luke Campbell, Reform UK mayor for Hull and East Yorkshire, has previously stated that a levy would
"not be the right approach"for his region, creating the cross-boundary disparity that concerns operators like Rusden.
Paddison said the consultation findings in North Yorkshire would provide
"key industry insights"into the implications of introducing a levy. He noted that
"there will also be learning from other countries and other areas in Europe that have a levy and the impact it's had - not just in terms of visitor numbers and the revenue generated, but how that money's spent."
What happens next?
If national legislation is approved, Mayor Skaith has committed to holding a region-wide consultation before any levy is introduced. The combined authority is currently assessing implementation options, including the possibility of choosing between percentage or flat-rate charges, with potential exemptions such as for residents.
The authority is awaiting the Government's decision following the national consultation that closed in February. Officials in North Yorkshire and York are still reviewing consultation feedback before determining next steps. Any implementation would depend on national legislation granting combined authorities the power to introduce such a levy.
