Councillors approved a motion on Thursday, March 27 which instructs the Labour Executive to explore the different ways a visitor levy, otherwise known as a tourist tax, could be introduced.
Labour’s Cllr Conrad Whitcroft, who tabled the motion, said the charge would stop residents having to pick up the tab for the cost of managing tourism.
But Conservative group leader Cllr Chris Steward said while he thought the levies would ultimately become more common, York should be wary of being seen to lead the charge.
The approval of Cllr Whitcroft’s motion including with support from the opposition Liberal Democrats who called for one during debates on York Councils Budget in February.
Backers of overnight stay charges say it would help pay for York’s upkeep and could be invested in its tourism offering but those against claim it could put visitors off.
Some hotels and others in the hospitality industry have also voiced concerns about how a charge would be collected and spent.
English councils do not currently have powers to introduce overnight stay charges like those levied in European cities but places such as Manchester have brought them in using legal workarounds.
Councillors heard work had already been ongoing on getting a charge, with York Council’s Labour Leader Cllr Claire Douglas having lobbied nationally for powers.
But York Council’s Labour Economy Executive Member Cllr Pete Kilbane told councillors he believed regional mayors like North Yorkshire’s David Skaith would be the ones to get the powers.
He added discussions had continued over whether to follow Manchester and set up a dedicated business improvement district (BID) for hotels to collect a charge.
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Cllr Kilbane said: “We’ve been dealing with York BID and Hospitality Association York on this topic but it’s fair to say it’s been quite a sensitive issue that we’ve had to progress carefully with.
“What I’m saying to the industry is that they should get their ducks in a row now and set up a BID but the difficulty is getting them to vote for one because there are concerns we need to address.
“But it’s in their interests to get a BID in now and chose how its done rather than for this to be imposed on them which I’m sure it will be within the current term of this Government.”
Cllr Kilbane’s comments came after the Liberal Democrats called for some form of levy to be introduced by 2027 at the latest and claimed the industry had been been properly consulted.
Liberal Democrat economy spokesperson Ashley Mason said any levy needed to come with proper support for hospitality businesses that were already struggling.
The councillor said: “It’s the right time to introduce a charge that would allow the sector to invest in making improvements.
“But it must be accompanied by proper consultation.”
Conservative Cllr Steward said much of the work agreed to by councillors on Thursday could already have taken place.
He added the council should also look at scrapping council tax exemptions for students in line with a call tabled by independent Cllr Mark Warters, though this was rejected.
The Conservative group leader said: “Tourist taxes will become more common and they will be legislated for, but we don’t want to be seen to be leading the charge.
“There’s still questions about how it would work, whether it would be charged as a percentage, per room or outside the city centre or not.”
Labour’s Cllr Whitcroft said backing for his motion signalled the start of the conversation on the issue which would flesh out details about the proposal.
The Fishergate ward councillor said: “This isn’t a simple tax and spend solution, it’s about who we are as a city.”
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