The UK Government, through the Ministry of Housing, Communities and Local Government, opened a public consultation last year on the possibility of granting mayoral strategic authorities across England the power to create local taxes for those staying overnight in their territories. The stated objective is to fund tourism, culture, and local infrastructure through accommodation charges. The consultation closed on February 18, 2026.
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This is not an unprecedented idea in the country itself. Manchester and Liverpool already apply similar mechanisms through their Accommodation Business Improvement Districts, making this initiative a possible extension of a practice that is growing in England.
Tourism, a sector in the UK arriving with accounts in the red
Bacta warns that Family Entertainment Centres (FECs), present in many of the UK’s coastal destinations, arrive at this debate in a fragile position. Between 2015 and 2024, the sector’s turnover fell by 25% and operating profits dropped by 18% in the same period. Added to this is a further 29% drop in operating profits between 2023 and 2024 alone, showing that the decline is not only persisting but accelerating.
These businesses, mostly small and medium-sized enterprises, operate in British coastal towns such as Brighton, Blackpool, or Scarborough, where activity depends on the weather, seasonality, and the spending power of the domestic tourist. The domestic visitor arriving with a family and a tight budget is the core customer of this sector.
The projected impact: worrying numbers
Based on evidence from the Tourism Alliance, Bacta estimates that even modest rates of the new tax would reduce overnight visits by between 1% and 2% in English coastal areas. Although the percentage seems small, its effect on FECs would be direct: annual losses of between 17.7 and 35.4 million dollars for these communities, plus the impact on 362 jobs.
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Allaster Gair, Communications Director at Bacta, puts it clearly: “Many visitors to coastal towns are families with fixed holiday budgets. Access to leisure and family time must be protected, especially for those with less financial margin.” Gair also notes that Bacta is prepared to expand its arguments before the Department and provide additional research to support its position.
The precedent that gives confidence to the tourism sector
This is not Bacta’s first tug-of-war with the British treasury. In November 2024, the Chancellor of the Exchequer Rachel Reeves announced a freeze on Machine Games Duty at its current rate of 20%. The sector feared a hike to 50%, which according to Bacta would have forced the closure of hundreds of venues across the UK.
Added to this is more good news: the 10% bingo duty will disappear completely from April 2026, a direct relief for FECs that include these types of games in their offering.
The question that remains open
With these recent results as backing, Bacta faces the debate on the tourist tax with the same strategy: concrete data, impact on employment, and defense of the country’s most vulnerable coastal communities. If the Government applies the same criteria it used with the machine tax, the sector has arguments to expect a favorable response. If not, it will be the British coasts that pay an unexpected part of the bill.
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