Labour’s proposed tourist tax could make some of the cheapest UK family breaks significantly more expensive. Butlin’s chief executive Jon Hendry Pickup has warned that the planned £2 per person, per night charge could price many working-class families out of a holiday and place more pressure on the UK hospitality industry.
The policy is still under consultation, but businesses fear it could increase the cost of staycations at a time when households are already struggling with rising living costs.
Key points:
- Families could pay an extra £32 on a four-night break for four people
- A two-week UK holiday may cost more than £100 extra
- Holiday parks and seaside towns could lose visitors and income
- Hospitality businesses say the levy is aimed at Airbnb but unfairly affects traditional resorts
- Rising National Insurance and business rates are already putting pressure on the sector
Why Is the Butlins Boss Warning That Labour’s Tourist Tax Could Be “Disastrous”?
Jon Hendry Pickup believes Labour’s proposed visitor levy could be “disastrous” because it would hit the families most likely to rely on low-cost UK holidays.
He argues that a flat charge of around £2 per person, per night may sound small, but it has a much bigger effect on budget breaks than on expensive hotels.
For families choosing an affordable seaside holiday, even a modest extra charge can make a noticeable difference. Mr Hendry Pickup said the policy risks turning domestic breaks into a luxury rather than an option for ordinary households.
He has repeatedly described the measure as “a holiday tax” rather than a tourist tax because it would apply to British families travelling within the UK, not only to overseas visitors.
He also warned that the levy could hurt hospitality businesses that are already dealing with higher staffing costs, larger tax bills and weaker consumer spending.
In his view, the policy may unintentionally damage holiday parks, budget accommodation and local tourism economies rather than solving the problem it was designed to address.
During one interview, Mr Hendry Pickup said:
“I remember that statement very well, but you see what’s happening. It’s a holiday tax. It could be disastrous for Butlin’s and businesses like us.”
What Is Labour’s Proposed Tourist Tax and How Would It Work?
Labour’s proposed tourist tax, often described as a visitor levy, is still under consultation and has not yet been formally introduced. Under the current proposal, local mayors and councils in England could be given the power to add an extra charge to overnight stays.
The levy is expected to be around £2 per person, per night, although the exact amount could vary depending on where the holiday takes place. The charge would apply whether you are staying in a city hotel, a countryside cottage or a family holiday park.
Accommodation that could be affected includes:
- Hotels
- Holiday parks
- Bed and breakfasts
- Guest houses
- Airbnb properties
- Holiday lets and self-catering accommodation
The Government’s main aim is to target the rapid growth of short-term rental platforms such as Airbnb, particularly in areas where local residents are struggling to find housing. Ministers argue that a modest levy could also help raise money for local services, tourism infrastructure and transport.
However, hospitality businesses say the proposal does not properly separate short-term rental properties from traditional accommodation providers.
A large family resort, a small B&B and a one-bedroom Airbnb could all end up paying the same rate despite operating in very different ways.
Businesses are also concerned that local mayors could introduce different charges in different regions, creating confusion for holidaymakers and making UK trips less predictable and more expensive.
How Much Could Labour’s Tourist Tax Add to a Family Holiday?
For many families, the biggest concern is not the idea of a tourist tax itself, but how quickly the costs could add up. A charge of £2 per person, per night may appear small at first glance. However, once you apply it to an entire family staying for several nights, the final bill can increase sharply.
Holiday companies say the extra amount would be most noticeable on cheaper breaks, where even a small additional charge can make a holiday much less affordable.
How Would the £2 Per Person, Per Night Charge Affect a Family of Four?
A family of four staying for four nights would pay an extra £32 under the proposed system.
The calculation is straightforward:
- £2 per person
- 4 people
- 4 nights
That means:
- £2 × 4 people = £8 per night
- £8 × 4 nights = £32 extra
For a family already paying several hundred pounds for travel, food and accommodation, an additional £32 may be frustrating but manageable. However, for low-cost holiday parks and budget accommodation, the impact is much greater.
Butlin’s says some of its cheapest family breaks can cost less than £50. In that situation, an extra £32 almost doubles the price of the holiday. That is why the company argues the levy would hit low-income families harder than wealthier travellers staying in expensive hotels.
Mr Hendry Pickup explained that the charge is especially difficult because it is fixed. A luxury hotel guest paying £300 per night may barely notice an extra £2 charge. A family booking a low-cost break for £49, however, will see a much larger increase in percentage terms.
He said:
“A couple of weeks ago, you’d be paying £49 for a family of four, so if you put £2 per person, that suddenly becomes out of reach of a bunch of people in the UK.”
Could a Budget Butlins Break Suddenly Become Too Expensive?
One of the clearest examples comes from the cheapest breaks offered by Butlin’s. According to the company, a family of four was recently able to book a short break for £49.
If the tourist tax were added, the total could rise to £81.
That increase would include:
- Original holiday price: £49
- Tourist tax: £32
- New total: £81
Although £81 may still sound relatively affordable, the increase is more than 65%. For families on a tight budget, that can be the difference between booking a holiday and staying at home.
The concern is even greater because the tourist tax would come on top of other rising costs, including:
- Higher fuel prices
- More expensive food and drink
- Increased train fares
- Rising accommodation prices
- Extra spending on activities and entertainment
Many families are already cutting back because of the cost-of-living crisis. Parents may choose a shorter break, a cheaper destination or no holiday at all.
Hospitality businesses fear that even a small extra charge could reduce bookings, especially outside school holidays when demand is already lower.
A realistic example might involve a family in the Midlands planning a weekend break in Skegness during the spring. They may have saved carefully for a low-cost trip and chosen a budget room to keep spending down.
If the final cost increases unexpectedly because of a local visitor levy, that family could decide the holiday is no longer worth it.
That is why the debate is not only about money. It is also about who can still afford a holiday in Britain if the proposal becomes law.
Could a Two-Week UK Holiday End Up Costing £100 More?
The extra cost becomes much larger for longer breaks. Hospitality leaders have warned that a two-week UK holiday could cost at least £100 more under the proposed levy.
For example:
- Family of four
- 14-night stay
- £2 per person, per night
The total would be:
- £2 × 4 people × 14 nights = £112
That means a family taking a longer summer holiday could pay more than £100 before they have spent anything on food, transport or activities.
Larger families could face even higher costs. A family of five staying for two weeks would pay £140 extra. Families travelling during school holidays, when accommodation is already more expensive, could feel the increase even more strongly.
Hospitality businesses believe this may lead to several changes in behaviour:
- Families may shorten their holidays
- Some may spend less in local restaurants, shops and attractions
- Others may choose not to travel at all
- Some may decide that a package holiday abroad offers better value
Industry leaders fear this could weaken the appeal of UK staycations, especially in coastal areas that rely heavily on domestic visitors. If the cost of a British holiday becomes similar to, or even more expensive than, travelling overseas, some families may simply choose to spend their money elsewhere.
Why Does Butlins Believe the Tourist Tax Is Targeting the Wrong Businesses?
Butlin’s believes the proposed levy is aimed mainly at Airbnb-style properties, but unfairly captures other businesses that have very different models.
The Government has suggested the charge could help deal with the rapid growth of short-term rental properties, especially in places where local residents struggle to find affordable housing. However, Butlin’s argues that holiday parks and family resorts are not creating the same problem.
Mr Hendry Pickup says the proposal does not recognise the differences between:
- A single Airbnb property in a city centre
- A small family-run B&B
- A large holiday park employing hundreds of local people
Each would potentially face the same flat-rate charge.
He believes this creates an unfair situation because businesses such as Butlin’s rely on offering affordable breaks to British families. Unlike Airbnb hosts, holiday parks also provide jobs, entertainment, restaurants and activities that support local communities.
In another interview, he said:
“It is designed to target short stays like Airbnb and does not account for the variety of business models in the visitor economy. I hear messages from the Government saying they’re going to focus on the cost of living, but then they impose a holiday tax on British people travelling to other parts of the UK.”
Could the Tourist Tax Hurt Seaside Towns and Local Economies?
Supporters of the levy argue that it could raise money for local areas. However, tourism businesses believe the opposite may happen if fewer people choose to visit.
Many UK seaside towns rely heavily on families taking short domestic breaks. If the cost of staying rises, fewer visitors may travel, and local businesses could lose important income.
Why Could Fewer Holidaymakers Mean Less Money for Local Businesses?
When a family visits a seaside town, they do not only spend money on accommodation. They also buy meals, use public transport, visit attractions and shop in local stores.
If the number of holidaymakers falls, many businesses could lose trade, including:
- Cafés and restaurants
- Pubs and bars
- Ice cream shops
- Taxi firms
- Arcades and attractions
- Independent shops
Hospitality groups warn that the impact of a tourist tax goes far beyond hotels and holiday parks. A family that chooses not to travel is also money lost for the wider community.
According to industry leaders, tourist spending helps keep many local high streets alive. In coastal areas, especially outside the peak summer season, local businesses often depend on a steady flow of visitors to survive.
For example, if a family cuts their holiday from seven nights to four nights because of the extra cost, they may also spend less on eating out, entertainment and shopping.
A tourist tax may therefore reduce the amount of money flowing into the local economy even if the accommodation provider collects more revenue for the council.
Which UK Seaside Towns Could Be Most Affected?
Butlin’s has major resorts in three towns:
- Skegness
- Minehead
- Bognor Regis
These communities depend heavily on domestic tourism. Local shops, restaurants and seasonal workers all benefit when families visit.
Skegness, for example, has long relied on family holidays and seaside tourism. Many local businesses earn most of their income during the summer months. A drop in visitor numbers could therefore have a direct effect on jobs and local spending.
The same applies to Minehead and Bognor Regis, where the tourism sector plays a major role in the local economy.
Mr Hendry Pickup argues that businesses like Butlin’s are part of the economic fabric of these towns. Holidaymakers support not only the resort itself but also nearby businesses and services.
He said the company helps create employment and economic activity in coastal communities that may otherwise have limited opportunities. For that reason, he believes a visitor levy could have wider consequences than ministers expect.
Could Families Choose Cheaper Holidays Abroad Instead?
One of the biggest concerns for the hospitality sector is that some families may eventually decide that going abroad is cheaper than staying in Britain.
Package holidays to countries such as Spain, Portugal and Turkey are often heavily discounted. If UK holiday costs continue to rise because of a tourist tax, some families may compare prices and conclude that travelling overseas offers better value.
Industry groups warn that this could lead to:
- More spending leaving the UK
- Fewer visitors to British seaside towns
- Lower revenues for local businesses
- Reduced demand for UK accommodation providers
Many European destinations already have tourist taxes, but supporters of the hospitality industry say those countries often have lower VAT rates and cheaper accommodation overall. As a result, a small visitor levy abroad may not have the same effect as an extra charge on already expensive UK holidays.
If families begin to view UK breaks as poor value for money, the long-term result could be fewer staycations and more overseas travel.
How Is the Tourist Tax Adding to Wider Pressure on the Hospitality Industry?
Hospitality businesses say the proposed levy is arriving at the worst possible time. Hotels, pubs, restaurants and holiday parks are already facing higher costs in several areas.
These pressures include:
- Rising business rates
- Higher energy bills
- Larger wage costs
- Increased employer National Insurance
- More expensive food and supplies
Butlin’s says the tourist tax would add another financial burden at a time when many businesses are still recovering from recent economic difficulties.
Holiday parks are particularly frustrated because they have largely been excluded from recent support measures that helped pubs and music venues with their business rates. Yet many resorts offer accommodation, food, entertainment and live events in exactly the same way.
Industry leaders believe the combined effect of all these rising costs could reduce investment, limit expansion and make it harder for businesses to keep prices affordable for customers.
Why Does Butlins Say Rising Employment Costs Are Making It Harder to Hire Young People?
Alongside the proposed tourist tax, Butlin’s says changes to employment costs are making it more difficult to recruit younger workers. The company has traditionally employed teenagers and young adults in part-time and entry-level roles.
These jobs often include:
- Lifeguards
- Restaurant staff
- Entertainment assistants
- Weekend and seasonal workers
However, recent changes mean employers now pay National Insurance at 15% on earnings above £5,000 instead of 13.8% on earnings above £9,100.
According to Mr Hendry Pickup, this has made it much more expensive to hire younger people who only work a small number of hours each week. Businesses may therefore decide it is cheaper to employ older and more experienced full-time staff instead.
He said the changes are especially disappointing because companies such as Butlin’s have often provided first jobs and training opportunities for young people in coastal towns.
Mr Hendry Pickup explained:
“Historically, we would recruit people from 16 and onwards, possibly in their first job, and give them a skill set like lifeguarding so that they could move their way into the workforce. They might work nine hours a week on a Saturday, while they’re still at school, and that would work well for us. But it’s become substantially more expensive to recruit somebody at that age than it was previously.”
How Does Labour Defend the Tourist Tax Proposal?
Labour argues that the visitor levy could provide extra money for local communities and improve the areas that attract tourists.
The Government says any money raised could be used for:
- Local transport
- Cleaner streets
- Better infrastructure
- Tourist attractions
- Public services in busy visitor areas
Supporters also point out that many major European cities already have similar taxes. They argue that a modest charge of £2 per night is unlikely to stop people travelling if the money is reinvested properly.
Rachel Reeves and several regional mayors believe the proposal could give local areas more control over their tourism economies. Sadiq Khan and Steve Rotheram have both supported the idea, arguing that it could raise millions of pounds for local improvements.
However, ministers have stressed that the details are still being discussed and no final decision has yet been made.
Are Tourist Taxes Already Used in Scotland, Wales and Europe?
Yes. Similar tourist taxes are already planned or operating in other parts of the UK and across Europe. In Scotland, Edinburgh is preparing to introduce a 5% overnight levy on hotel and Airbnb stays. In Wales, councils are expected to gain the power to charge £1.30 per person, per night from 2027.
Across Europe, tourist taxes already exist in places such as:
- Amsterdam
- Barcelona
- Paris
- Venice
- Milan
Supporters of the UK proposal argue that England is simply catching up with other destinations.
However, critics say there is an important difference. Many European tourist taxes apply in cities that attract large numbers of international visitors. By contrast, the proposed English levy could fall heavily on British families taking low-cost domestic holidays.
Businesses also point out that countries such as Spain, France and Portugal often have lower VAT rates for tourism and hospitality than the UK.
That means a visitor levy abroad may be balanced by lower costs elsewhere, while British families could face a tax on top of already expensive accommodation and travel. For this reason, many hospitality leaders believe comparisons with Europe do not tell the full story.
What Does the Butlins Boss Tourist Tax Warning Mean for UK Families?
The warning from Jon Hendry Pickup matters because it highlights how even a small extra charge could change the cost of a family holiday.
If the tourist tax goes ahead, some families may:
- Book shorter breaks
- Spend less during their holiday
- Delay travel plans
- Decide not to take a UK holiday at all
The proposal has not yet become law, so there is still time for the Government to change or limit the policy. Businesses are continuing to argue that any levy should focus on short-term rental properties rather than family holiday parks and budget accommodation.
For now, the main message for families is simple: UK staycations could become more expensive in the future, but the final details have not yet been decided. Anyone planning a domestic holiday should watch closely for updates as the consultation continues.
In the end, the Butlins boss tourist tax warning is really about affordability. Supporters believe the levy could improve local areas, but critics fear it may make ordinary family holidays harder to afford and weaken the businesses that rely on domestic tourism.
FAQs
Could the tourist tax apply to children as well as adults?
Yes, the current proposal suggests the £2 charge would apply per person, which means children could be included unless exemptions are introduced. That is one reason why families with several children could face much higher holiday costs than couples or solo travellers.
Would the tourist tax be charged on every night of a hotel stay?
Yes, the proposed levy would usually apply to each night you stay in accommodation. The longer your trip lasts, the more you would pay in additional charges.
Could some areas in England introduce the tax while others do not?
Yes, Labour’s plan could allow local mayors or councils to decide whether to introduce the levy in their own area. This means some towns or cities may charge extra while others may not.
Would the tourist tax affect Airbnb properties differently from hotels?
The proposal is mainly aimed at short-term rental properties such as Airbnb. However, hotels, holiday parks and other accommodation providers could still end up paying the same charge.
Could holiday companies absorb the extra cost instead of passing it on?
Some businesses may try to cover part of the cost themselves, especially during quieter periods. However, many hospitality firms say rising costs make it difficult to avoid passing at least some of the levy on to customers.
When could Labour’s tourist tax be introduced?
The policy is still under consultation and has not yet been approved. If it goes ahead, most reports suggest it could be introduced within the next few years.
Why are hospitality businesses more worried about this tax than European tourist taxes?
Many UK businesses argue that British holidays are already expensive because of higher energy, staffing and tax costs. They believe adding another charge could have a bigger effect in the UK than in countries where accommodation is often cheaper.
