The following amendment has been selected: amendment 1 in the name of Lesley Griffiths.

We move on to item 4—no, item 5, the Welsh Conservatives debate on tourism. I call on Tom Giffard to move the motion.

Motion NDM7990 Darren Millar

To propose that the Senedd:

1. Celebrates Wales's strength as a world-class tourist destination.

2. Regrets the devastating impact of COVID restrictions on the tourism industry in Wales.

3. Believes that the Welsh Government's proposed changes to the non-domestic ratings system will undermine many holiday letting businesses.

4. Notes Wales Tourism Alliance data that shows a large majority of businesses will be unable to meet the criteria to qualify as a holiday let business.

5. Calls on the Welsh Government to:

a) abandon damaging proposals for a tourism tax in Wales;

b) acknowledge that the majority of responses to its consultation oppose the proposed non-domestic rates changes for holiday lets;

c) scrap plans to extend the number of days that a property must be let in order to meet the non-domestic rating requirement.

Motion moved.

Diolch yn fawr iawn, Dirprwy Lywydd. I formally open this debate today on tourism in Wales, tabled in the name of my colleague Darren Millar.

Whether it be Porthcawl, Prestatyn, Barry, Llandudno or Tenby, the Welsh Conservatives are the party that truly represents tourism communities here in Wales. Wales has so much to offer for prospective tourists not only from within the UK, but from across the world. And I know that Members across this Chamber and virtually will be only too keen to mention tourism destinations in their local areas in this debate, so I thought I'd take the opportunity to mention some of mine. In my region of South Wales West alone, I can boast the UK's first area of outstanding natural beauty, the Gower peninsula; Neath abbey, which was described as the fairest abbey in all of Wales; and Porthcawl, home to the annual Elvis festival. As you shake, rattle and roll across South Wales West, you simply can't help falling in love with the place, but I wouldn't recommend staying at the heartbreak hotel. [Laughter.]

We all know the importance of the tourism industry to Wales. In 2019, there were 154,000 people in Wales working in tourism-related industries, and, according to the Wales Tourism Alliance, pre COVID, one in every seven jobs in Wales was in tourism or dependent on it. But the tourism industry has had a tough time of it over the last two years. Quite often, it was the businesses that operated in this sector that were the first to close and the last to reopen, with a whole host of other restrictions along the way. And I know that many tourism businesses were grateful for some support packages from the Welsh Government, but in particular, it was the UK Government's furlough scheme that kept many afloat, which means we still have such a vibrant tourism sector in Wales today. But the reason we tabled this debate is because many who operate in the tourism sector don't share that same optimism about the future. Specifically, they're worried about a double whammy of additional burdens that the Welsh Government are planning to place on them.

Firstly, I wanted to talk about the proposals from the Welsh Government to change the occupancy threshold for self-catering accommodation from 70 days of occupancy per year to a massive 182 days. And whilst the Welsh Government is seeking to take action on second homes, it's a blunt instrument that'll end up as a hammer blow to the tourism sector instead. And the key reason for that is the Welsh Government has either been unable or unwilling to make a distinction between second homes and self-catering holiday lets. This means that many normal people across Wales who let out flats, houses and cottages to visitors will be completely unable to meet the new threshold and it will price them out completely of ever being able to afford to offer visitor accommodation to people across Wales and internationally. And that isn't a political argument; that's something that'll impact real tourism operators here in Wales.

The Wales Tourism Alliance has helpfully surveyed some of their members, and here are just some of the things they had to say. One said, 'Over the last 20 years, I've never been able to meet the accommodation for 182 days a year, and that won't change in April 2023.' One holiday-let business in Pembrokeshire said, 'I'm seriously considering selling my property. This will not free up a permanent home for a local person, but potentially take affordable holiday accommodation off the market and thereby reduce tourism income into the local economy.' Another—

Will you take an intervention on that?

Of course.

The point here is, though, that they can't even put their property into the housing market because the planning permissions that were given don't allow for that. So, this is the issue here, where there's an absolute anomaly that needs to be addressed.

No, you're absolutely right, and I think my colleague Mark Isherwood raised that with the Minister earlier, and it's a really important point and I hope the Welsh Government work on that proposal as well, because a lot will see themselves shut out from that.

Well, another operator in Ceredigion said, 'The impact of the 182 rule on my business would mean that I would be unlikely to reach this threshold having reached 22 weeks in 2021, which is a good year, and with 18 weeks booked so far this year, I anticipate maybe a few more weeks, but 26 weeks is unlikely.' On the Llŷn peninsular: 'The building is available 365 days a year, but very few people want to come in the winter, despite us having underfloor heating and wood burners. I consider 2021 to have been a very good year, and in that very good year, I managed to achieve 163 days.'

Someone in Bala, Gwynedd, said, 'We have never achieved this level of occupancy in our five years of trading, with the best year being an average of 152 nights per cottage. The season is short here and winter months are a very hard sell. The failure and closure of our business, and others like us, would be felt far and wide in our rural community. We employ many local trades for maintenance—electricians, plumbers, decorators, gardeners. We spend a small fortune locally each year on cleaning products, spare parts and produce for our welcome baskets.' And these stories go on and on and on.

And just before the Easter recess, I attended a meeting of the cross-party group on tourism, chaired by my colleague Sam Rowlands, and the message to the Welsh Government there was clear too: this is a harebrained scheme that'll only serve to punish tourism businesses, particularly in rural Wales. And I hope the Plaid Cymru Members listen to some of those accounts too. Ceredigion, Llŷn peninsula, Bala, all of those parts of the country are represented by Plaid Senedd Members. People in those industries will notice Plaid's role in that too.

But the sector is not being unreasonable in saying it doesn't want any change. The majority of responses to the Welsh Government's consultation were to raise the occupancy threshold from 70 days to 105 days, in line with Her Majesty's Revenue and Customs's threshold between council tax and business rates. This would amount to a 50 per cent rise and was suggested by members of a professional sector that understands booking trends, marketing and customer behaviour. The sector is willing to meet the Government in the middle here, but the Government is simply unwilling to listen.

The other big threat on the horizon from the Welsh Government is the proposed introduction of a tourism tax. We know that this is a Welsh Government that likes to take its ultra-left-wing policy ideas straight from the middle pages of the Morning Star, but this is quite something else. This proposal is totally regressive and it'll impede the very businesses that we should be supporting to come out of the other side of the last couple of years.

I've raised, as have my colleagues, our party's opposition to this tax on numerous occasions in this Chamber and we're always met with the same old tired response from Welsh Government that other countries across the world have implemented this tax, without taking into account any specifically Welsh factors at all. So, they say that the introduction of a tourism tax would have no impact at all on visitor numbers to some of our key tourism locations in Wales. But I thought Ministers might be keen to hear the latest from Venice, one of the world's leading tourism destinations, that has now said it's introducing a tourism tax to dissuade further visitors from attending. Yes, you heard that right; it turns out that extra taxes for visitors mean fewer people want to visit. We also know that, from my questioning of both the First Minister and the finance Minister, there is no assurance at all that such a tax will lead to any additional money being spent on improving tourism offers in these areas. The Government either cannot or will not be able to prevent councils from deleting existing tourism budgets and replacing them with this tax instead.

So, what do we really know about the Government's two proposals here? They'll lead to fewer places to stay, small businesses going out of business, fewer visitors overall and no more money being spent on tourism. I'm shocked they didn't put that on the front page of the manifesto. But the Welsh Government still has time to change course here. Businesses are willing to work with you and meet you in the middle, but they need a Government that is on the side of the tourism sector. What they don't need is a Government looking for a roundabout way to raise more taxes to pay for more politicians in this place. Thank you.

I have selected the amendment to the motion, and I call on the Minister for Finance and Local Government to formally move amendment 1, tabled in the name of Lesley Griffiths.

Amendment 1—Lesley Griffiths

Delete all and replace with:

To propose that the Senedd:

1. Recognises the world class strength of Welsh tourism and welcomes the significant support provided to the tourism industry and operators by the Welsh Government through the COVID pandemic.

2. Recognises the United Nations World Tourism Organization’s definition of sustainable tourism development: 'Tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment and host communities'.

3. Recognises that tourism levies are common place across the world, with revenues used to the benefit of local communities, tourists and businesses, which in turn help make tourism sustainable and successful.

4. Welcomes the commitment to introduce local tourism levies which will allow local authorities to raise a tourism levy if they choose to do so.

5. Notes the intention to undertake a major consultation during autumn 2022 as part of a careful process of developing proposals for a levy, which will involve communities, businesses and operators and further notes that the process of translating those proposals into legislation will be subject to detailed scrutiny and approval by the Senedd.

6. Welcomes the Senedd’s decision on 22 March to approve the Council Tax (Long-term Empty Dwellings and Dwellings Occupied Periodically) (Wales) Regulations 2022, introduced as part of the wider commitment to address the issue of second homes and unaffordable housing facing many communities in Wales and to tackle the housing crisis

7. Welcomes the commitment to act on the wide-ranging consultations undertaken to date to ensure genuine self-catered accommodation is distinguished from domestic properties with regard to local taxes and notes that a technical consultation on draft regulations to amend the lettings criteria for self-catering accommodations undertaken as part of taking forward this commitment closed on 12 April; the responses to which are currently being analysed.

Amendment 1 moved.

Formally.

I think we can all agree that there is an issue that needs to be addressed when it comes to tourism, and that is its impact on local communities. The importance of the tourism industry to Wales is undisputed, but we must avoid the type of extractive tourism that uses Wales as a resource. We all share the ambition of seeing Wales as a top-quality sustainable tourism destination, but this development must happen with and not to the communities it most impacts.

The key word here for me is 'sustainable'. The current iteration of the sector is putting a strain on our natural resources, our landscapes and our local infrastructure and services. In 2021, Eryri, the Brecon Beacons and Pembrokeshire national park authorities saw increases in illegal camping, littering and human waste on paths and in car parks. If tourism is not managed correctly, it will cause erosion to our paths, we will see more litter and pollution in our landscapes.

Turning to the motion, first, on the non-domestic rates and occupancy threshold increases, in so many communities in Wales, the purchasing of residential homes to use as second homes or Airbnb-style holiday lets is pricing out local people from their own communities and undermining the Welsh language. We come back to that key word, 'sustainable'. For me, for Wales to be a world-class tourism destination, the culture of our local areas will be key to achieving that, so pricing out our locals, in my view, is counter-productive. Let's be frank here: in some of our rural communities, we are seeing gentrification. There are no two ways about it.

On the increase to occupancy, the decision hasn't been made yet as to increasing the occupancy threshold. The consultation has ended, but no final decision has come, and, as Tom Giffard rightly pointed out, the Wales Tourism Alliance, UKHospitality Cymru and PASC UK have acknowledged that an increase should happen. One of their own recommendations in their consultation response recommends that the Welsh Government increases the threshold from 70 days to 105 days. We're not at the end of the road yet, but we must address the loophole that we in Plaid have been highlighting for some time.

On the tourist levy, this isn't a new idea, as Tom Giffard again rightly pointed out. There are countries across the globe that use a tourism levy, for example, Austria, Belgium, Bhutan, Bulgaria, the Caribbean islands, Croatia, the Czech Republic, France, Germany, Greece, Hungary, Indonesia, Italy, Japan, Malaysia, New Zealand, the Netherlands, Portugal, Slovenia, Spain, Switzerland and the United States. I could go on—

Will you take an intervention?

—but the point is this: the UK is the outlier here. Yes, go on.

Thank you for drawing attention to the list of countries that you mentioned that have introduced a tourism tax. I wonder what you make of Venice now, who have introduced a new tourism tax to dissuade people from coming into Venice, because they know it'll be a deterrent to new visitors.

Thanks for your intervention, Tom, and, again, you are right to point out that Venice is using it to dissuade tourism, but that is the whole point of tax: it's a lever to encourage people to either do something that is going to be positive for the community or to dissuade negative actions. That's the point here about tax, isn't it? We all know that that is the point of a tax.

And, if we're going to use examples, let's use an example of Barcelona. I don't think, actually, there are many people who deny that Barcelona is a world leader when it comes to developing tourism policy. The revenue raised through its tourism levy is reinvested back into the community, improving, by virtue of that investment, the tourist experience. Since the introduction of this tax, the number of hotel guests registered in Barcelona has been steadily increasing.

So, this argument that a levy would be a disaster for Wales even though it works elsewhere leads me to believe that people don't think that Wales can compete with these destinations, that we are somehow sub-par. It's not a mechanism to penalise, but instead it's based on a notion of sustainability and mutual respect between the locality and the visitor. I think it's hard to argue against charging a small amount to visitors that will allow local communities to flourish and be protected, and allow tourists to continue to enjoy everything that Wales has to offer for years to come.

And as a final point that I want to make here, Dirprwy Lywydd, the tourism levy is yet to go to consultation, and any implementation will be a decision for the Senedd itself. In my view, the Tories' opposition to the levy is nothing more than an attempt to deflect from the Chancellor's own failures to support the tourism and hospitality sector. It's not just me saying that; it's businesses in the sector that are also saying this. Let's look at VAT: it was reduced to 12.5 per cent during the pandemic for the hospitality and tourism sector—very welcome indeed. Now, it's shot up to 20 per cent. This is on top of increased national insurance contributions and the exclusion of the use of red diesel for the sector, which in rural areas is widely used. If you want to help the sector, then lobby your Chancellor on these issues because that's what's causing the greatest hurt to the sector right now. That's the greatest threat to the sector right now, not a tourism levy.

The tourism sector in Wales is of significant importance to the Welsh economy and to the people who live and work here in Wales. Tourism plays a huge part in my constituency of Brecon and Radnorshire, from Ystradgynlais to Llanbadarn Fynydd, the town of books in Hay-on-Wye, the Greenman festival. I could go on, because Brecon and Radnor is the tourism hub of Wales.

Too many people in this place see our tourism sector as a cash cow. I take a far more positive view. Yes, there are difficulties facing our country, but taxing our tourism sector is not the answer. Councils across Wales will be potentially implementing an increase in taxes on genuine holiday lets of up to 300 per cent. This will have a huge impact on the local economy and our business owners here in Wales.

I can see why the Government wants to tackle the issue of second home ownership, and I am sympathetic to your aims. Is it right that someone 500 miles away can purchase a house in rural Radnorshire and use it as a holiday let for a few weeks of the year to avoid paying tax, driving locals away from the area and pushing house prices up? I doubt that many would say that this is acceptable. By taxing genuine tourism businesses, some of which face planning restrictions on occupancy, they will be penalised and forced out of business. The tax policy, however well intentioned, will come with unintended consequences for our business community. What we need to do is tackle the large number of empty homes and vacant homes or the lack of house building. These homes should be prioritised for local people to help solve the housing crisis. But what do we see from this Welsh Labour socialist Government? No plan, just a tax plan. 

This policy, as well as a tourism tax being planned by the socialists in front of me, is a recipe for disaster: a double whammy of tax on businesses and people who are providing a vital service and giving people who visit Wales a fantastic experience. I know that many across the floor and my new colleagues to the right will say that we need a tourism tax. They compare us to Europe and say that cities such as Amsterdam and Budapest have a tourism tax. So, why don't we have one here in Wales? We hear the First Minister quite regularly saying, 'In Wales, we will do it our way.' So, why do we have to follow everybody else? We can do it differently. Let's not have a tourism tax. Let's have a genuine conversation about the situation.

We simply don't have the numbers of people visiting the vast numbers of our Welsh destinations as many European locations do. We should be encouraging tourism and promoting Wales as a place that people want to come and visit, to grow our economy, providing jobs and opportunities for everyone. A tourism tax puts our economy at risk. This in turn puts jobs at risk at a time when people need jobs more than ever. The people of Wales and the people in Brecon and Radnorshire need a Government that is supportive, that's tackling the housing crisis and supporting our businesses, not using visitors and employees as a scapegoat to fill the coffers of this Government's failings. The Conservatives support our business community, the Conservatives support tourism, and we will oppose any obscene regulations brought in by this coalition of chaos between Labour and Plaid Cymru. We are the party of business and that is why I encourage everybody in this Chamber to support the Conservative motion today.

I welcome this debate and airing of the proposal, so hopefully the correct information will be known, going forward, about what is being proposed and what stage it is at. There have been some attention-grabbing headlines in the press, and it's being used as a political football. One being shared is that the Welsh Government were proposing that tourists would have to pay £15 a night to stay in Wales. Another, that my mother, who lives just across the border, fearfully shared with me, said that Cheshire residents may have to pay to visit Wales in a new tax plan, as though there's going to be a toll on the border as you enter Wales. So, I had to reassure her as well.

When going out to consult, people need to have the correct information. I've tried to reassure people that there will be a public consultation in the autumn, no fee has been set, and it will be up to individual local authorities to raise a tourism levy if they choose to do so. If there is to be a levy, it should be a reasonable amount. Many countries charge a tourist levy of €2, not £15 a night. It would raise much-needed revenue for local authorities to enable councils and national parks to manage and invest in services and infrastructure that make tourism a success, such as keeping beaches and pavements clean, through to maintaining local parks, toilets and footpaths—the critical infrastructure that supports tourism. It should be supported by all those that rely on it.

If the Conservative UK Government had not driven cuts to public services, which had resulted in closure or offloading of public toilets, play areas, libraries and other facilities during austerity, stretched street cleansing services—

Will you take an intervention?

Sure, my new neighbour.

Do you not agree with me that the reason that the Conservative Government had to take prudent measures to get the public finances back in order is because the Welsh Government and the Labour Government at the time left this country in a poor financial state? As the Chief Secretary to the Treasury said, there was no money left.

Actually, I don't. It was the banking crisis at the time and the way that the finances had been handled across the world, and that's how it was dealt with. Austerity went on for far too long. We're not discussing austerity at the moment, but I did want to bring it in because it does impact on public services. I still have the scars of 14 years of being a councillor, 10 years of year upon year of cuts as restructuring had to take place in councils. We went down from six depots to one depot at Flintshire council where I was cabinet member, and we see now how posts have been deleted over the years. We've got vacancies we can't fill now, and services are stretched. These are the service areas that I mentioned, such as street cleaning, footpath officers, and toilets as well. Over the years, they've been offloaded onto town and community councils or closed, basically. But if we'd had the money in place, we could have kept them open. Another one I have to clarify quite often is that council tax covers 25 per cent to 30 per cent of delivery of these services. Very often, people say, 'What does my council tax go to? What do I pay council tax for?' The rest comes from Government and a small proportion comes from income charging. Thank you.

I would like to refer Members to my own stated declarations of interest.

For years, Welsh Labour has undercut and undersold tourism here in Wales. A major sporting nation, with grand national parks, spectacular coastlines, bustling bars and restaurants in our towns and cities, Wales represents a corner of the United Kingdom like no other. But poor policy direction from Welsh Labour will continue to threaten communities in Wales, and, if unchampioned, the people of Wales could face the slowest recovery from the COVID-19 pandemic in the isles. If the past two years have shown anything, it is that the tourism industry and the people who work in these sectors are resilient, and they are themselves committed to building a bigger, better Wales. It has to be said that that's more than what can be said for this sleepy and dreary Welsh Labour Government in Cardiff Bay.

The First Minister and his colleagues have recently been boasting about their commitment to rebuilding the tourism sector. However, as always, actions speak louder than words, and what we are witnessing is an erosive strategy. If the Welsh Government expressed any interest in backing our tourism sector, they would abandon damaging proposals for a tourism tax in Wales. They would acknowledge the majority of responses to its consultation—yes, there's already been a consultation—on a tourism tax, and also opposing the proposed non-domestic rates changes for holiday lets. They need to acknowledge that they've simply failed to lift the industry to levels seen elsewhere across the UK. Perhaps the Minister needs reminding—in fact, I think the Welsh Labour Government needs reminding—that it is lower taxes that attract entrepreneurialism and business investment. This then ensures that the public services that are now so in decline in Wales, as Carolyn has mentioned—. You know, if we have a better private sector, with better business, paying taxes—natural taxes that are already set, not introducing new ones—then there's more money in public services.

You are also pursuing a tourism tax at a time of a return to 20 per cent VAT. All the other countries that have been mentioned, where they have a tourism tax, they do have lower thresholds of VAT. The hospitality industry simply cannot survive all of this. It is an onslaught of epic proportions, and it is a complete misunderstanding of the tourism sector. I have to say, I really like my colleague Luke Fletcher, but his anti-visitor, anti-tourism rhetoric is now actually starting to feed back to businesses in his constituency, and it is now becoming a fact that the industry itself see Plaid Cymru, and sadly now Labour, as being enemies to the tourism industry.

The Welsh tourism industry is largely made up of microbusinesses and small and medium-sized enterprises. The sector is vitally important to rural communities as well as urban economies, enhancing the provision of facilities and amenities, which are accessed by residents and visitors alike. In Wales, 25 per cent of registered businesses are in the visitor economy. They offer significant employment opportunities where alternatives are very limited. Here in Conwy county, tourism is worth £887 million, generated from 9.5 million visitors annually. The impact of COVID has already left its toll on businesses in the Aberconwy area, with losses of revenue ranging from around 60 per cent to 85 per cent.

In addition to supporting around 10,000 jobs in Aberconwy through furlough, the UK Conservative Government is further investing in the local economy, especially tourism, such as £51,000 in the Llandudno bay promenade enhancement, £219,000 in the Conwy culture strategy development, and £850,000 in a tourism innovation hub. Whilst the UK Government is investing in the Welsh tourism sector, I'm afraid the Welsh Labour Government are seeking to punish it. It's common economic sense to abandon the damaging proposals for a tourism tax in Wales. We also need to scrap the proposed 182-day threshold for holiday lets. We should all be working with businesses to see what support they need to keep creating jobs and sharing the best of Wales with the world. UKHospitality Cymru's executive director David Chapman, said: 

'This industry needs more TLC and less taxes. After two long years of commercial instability, with enforced closures and restrictions, we are now facing a costs and viability crisis and the last thing that we need is even more taxation.'

Post pandemic—

Janet, you need to finish now, please. 

Okay. Deputy Llywydd, if we are to truly propel the Welsh economy and tourism industry, Wales now needs an administration that supports the tourism sector, not one that constantly seeks to drive it into the ground. Diolch. 

I do regret, I have to say, when I see Conservative motions before us. This motion demonstrates that that group has no interest in making a constructive contribution, but rather it discusses the potential tax that may be introduced at some point in the future. There's going to be a consultation, there is no certainty, but there we are, we're wasting time discussing something that we don't know what its future will be.  

Will you take an intervention?

I won't take an intervention at this point, I do apologise, with all due respect. 

I won't take an intervention in this contribution, sorry, Andrew.

I do despair sometimes at the tactics of the Conservative Party. This motion is referencing the potential of a tourism levy, and is nothing more than a distraction from the failings of your own party down the road, the M4, in distant London. The crocodile tears that we see from the Conservatives deceive no-one. Conservatives run the Isle of Wight, and they are proposing a tourism tax for day-trippers. The Tory-run Bath and North East Somerset Council have repeatedly called for a tourist tax for Bath. You complain that it would make Wales more uncompetitive. Well, Bourton-on-the-Water in the Cotswolds introduced a tourism charge last year. By your own logic, this should result in all visitors going to nearby Chipping Norton or Cirencester, but no, Bourton enjoyed a packed Easter again this year.

The principle has already been accepted in any case. Holiday destinations across the UK have varying seasonal charges, for instance in the car parks, with car parking charges more expensive in the visitor season and cheaper in the winter. This is nothing more than a levy on visitors. Why is it that the Conservatives think it's okay for the private sector to practise this policy, but not Government? Entry to York Minster is free to local people, but if I visited, I'd have to pay £12.50. If I wanted to go to one of the historic royal palaces—the Tower of London, for instance—I'd pay £29.90, but it's free for community groups in Kensington and Chelsea, Westminster, Hammersmith and Fulham and Brent. But no, the Members opposite have no complaints at all about varying pricing schemes when the money goes into private bank accounts. What they don't like is the idea of wealth distribution—someone's money going to pay for someone else's healthcare or education, for instance. At least be honest about it. 

Then, of course, there's the complaint that a tourism tax would make it hard for the sector during what it is a difficult time. And it is. But that argument by those Members opposite is nothing more than scaremongering. The hospitality sector is suffering right now, and they're suffering because of the tax hikes and the increased costs imposed on them by the heartless Conservative Government in London, led by a proven liar and a charlatan. These businesses are facing an existential threat today. Lifting the price cap on energy prices will mean that this will be the last season for many businesses. One business in my constituency, for instance, was paying £350 a month for electricity back in 2003. Today, they're paying £4,700 a month, based on 17p a unit, and that contract is going to increase to 50p a unit in November. This is going to be impossible for them. That's on your Government. 

Added to that, the hospitality sector can no longer use red diesel, so need to find a much more expensive source of fuel thanks to the Conservative Government. VAT has increased from 12.5 per cent to 20 per cent for the hospitality sector. That's on your Government. National insurance contributions have increased by 1.25 per cent. That's on your Government. And the suppliers are feeling this exact squeeze, pushing the price of beer and food up as well. This is all on the Conservatives, and it's happening now, today. There's no point in you harping on about the potential that the tourism tax might do some damage—

Will you take an intervention?

No, I won't, sorry. These businesses are crying out for help now—[Interruption.]—and the Tories are turning their back.

Mabon, two seconds. I would like to hear the end of the Member's contribution, so can I have some quiet on the benches opposite, please?

Diolch, Dirprwy Lywydd. I've written to Rishi Sunak and asked him to reverse the damaging cuts. I wonder if you'll join me and write to Rishi Sunak as well and encourage him to reverse these cuts. 

The Tories are right that tourism is an important sector, and it does need our support. We need a sustainable sector, one that benefits each community and ensures that the wealth created is retained in those communities. The consultation on a tourism levy will help to this end. The sector will have an opportunity to share their views and ensure that a new policy is designed around the sector's needs in Wales, a tailor-made Welsh policy responding to Welsh needs. Done properly and co-produced by the sector, a tourism levy could and should benefit the sector and benefit our communities. So, ignore the Tories' motion and support the amendment. Thank you.

I feel like I need to take a breather after that. Okay. First, let me begin by saying Wales has a unique landscape, a unique history and a unique culture. For years, especially during the lockdown, and recently over the Easter break, all of us saw visitors arrive in Wales to enjoy our mountains, our countryside and our beaches. Many come to Wales to visit our castles, our historic houses, as well as our gardens and our industrial heritage sites. They come to enjoy our vibrant culture, our arts festivals, music festivals and our eisteddfodau.

The importance of the tourist industry to Wales cannot be overstated. There were 143,500 people in Wales working in tourism-related industries in 2020, down from 154,000 the previous year. One in seven jobs in Wales is in tourism-related industries, and in some parts of Wales it is the mainstay of the economy. It would be wrong to regard tourism as a second-class service. Tourism is a fiercely competitive market requiring skills, talent and enterprise. Prior to the pandemic, it contributed to 6 per cent of all gross value added, over £3 billion to the Welsh economy. Given these figures, the importance of tourism is clear. It should also be clear that, with Wales's tremendous assets, the potential for growing this sector of the economy should be given a high Government priority.

No-one can deny that the tourism sector suffered significantly from the pandemic, from lockdowns, travel restrictions and the forced closure of hotels, hospitality and visitor attractions. The industry does need support and encouragement to maximise its recovery and exploit the enormous potential for growth that still exists. The last thing they need is for the Welsh Government to hinder their recovery by putting barriers in their way. Instead of marketing Wales positively and encouraging more visitors to come to Wales, the Welsh Government is planning to introduce a damaging tourism tax.

There are significant concerns from within the industry regarding the implementation of such a tax, and many questions do remain. These were highlighted by the all-party parliamentary group on hospitality in May 2019. They asked how would a levy be effectively charged in the absence of a comprehensive register of the supply of accommodation. They went on to point out that the day visitors spend significantly less in comparison to overnight visitors and a further cost on hotel rooms could disincentivise taking overnight trips. This would be bad for the hotel industry and could see a significant reduction in consumer spends within cities.

I'd like to hone in on what my colleague Janet Finch-Saunders mentioned when she was making her contribution, that the UK already has one of the highest taxed hotel sectors compared to countries in the EU. Countries in the EU that have a tourist tax have reduced rates of VAT, with Italy and France on 10 per cent, Germany at 7 per cent, Belgium and the Netherlands at 6 per cent. In comparison, VAT on the hotel sector here in the UK is 20 per cent. I would also like—[Interruption.] I would—[Inaudible.]

I would also like the Minister, when replying—in my role as shadow transport Minister—to rule out the introduction of congestion charges here in Wales, as this causes me concern, not just for visitors but for Welsh residents who simply want to take their family for a short vacation to another part of Wales. Because congestion charges would not only impose a burden on Welsh residents but add an additional burden on tourists coming into Welsh towns and cities, ultimately damaging the prospects of recovery for businesses that rely on tourists to survive. 

Deputy Presiding Officer, without a doubt, tourism is a key part of the Welsh economy and ensuring that it's in good health is essential. We have a responsibility here as politicians in the Senedd to support the sector right here, right now. It was a sector of industry particularly hit badly by the pandemic and does not need the imposition of unnecessary barriers in its recovery. I call on the Welsh Government here today to drop any plans for a tourism tax and congestion charges, and instead produce a strategy alongside key stakeholders that will address these problems and will allow this vital sector of our economy to grow and thrive as it so rightly deserves, having suffered so much in the past. Thank you so much.

I call on the Minister for Finance and Local Government, Rebecca Evans.

Diolch. There's absolutely no disagreement that tourism provides an absolutely substantial economic contribution to Wales, with tourism-related expenditure reaching more than £5 billion annually in 2019, pre pandemic, and the Welsh Government of course wants to see a thriving tourism industry and a strong recovery from COVID-19. In recognition of the impact of COVID we've provided unprecedented financial support to the sector. Tourism businesses have been eligible for grants from the £2.6 billion economic resilience fund, which has safeguarded 28,500 jobs across Wales. Many tourism businesses have also benefited from the £108 million cultural recovery fund, supporting cultural events and the individuals working in the sector, and tourism businesses have also benefited from the £730 million that we provided through our retail, leisure and hospitality rates relief schemes. These measures, as well as the non-domestic rates-linked grants and discretionary grants delivered by local authorities, have clearly enabled these sectors to survive.

The tourism industry in Wales is in a strong position to recover and rebuild post pandemic. Over the last five years, Wales has welcomed record numbers of UK visitors. Our tourism industry is mature, it's experienced and it still has the capacity to grow, but it has also told us that growth must serve to sustain, not threaten, the things that matter most. Our ambition is to support sustainable tourism development that addresses the needs of visitors, the industry, the environment and host communities, and that's a fundamental principle underpinning our proposal for a tourism levy.

In February I outlined the policy aims and the timeline for the development of tourism levy proposals. Our proposals present an opportunity for investment into those local communities and the services that make tourism successful, and it's only fair that a contribution is provided from visitors. We're at the start of the discussion on how the levy will be used to maintain and support those areas that we visit and enjoy.

Tourism levies, of course, as we've heard, are very commonplace across the world, with most countries in Europe applying them. They're proportionate by design and they represent a small percentage of the overall bill for consumers. There's little evidence that tourism levies have a negative economic impact. They're used to benefit those local areas and communities that choose to use them. The powers will be discretionary, empowering local authorities to make their own judgments and decide what's best for their communities. Of course, I welcome all views and evidence as we continue to work collaboratively with our partners to help shape these proposals. A major consultation will take place later this year, and that will be an opportunity for all views to be heard and considered. Through this process we'll design a tax that's aligned to our core tax principles, and one that works for communities in Wales.

On 2 March I announced the next steps we're taking following the consultation on local taxes for second homes and self-catering accommodation. The steps form part of our plans to ensure property owners make a fair contribution to the communities in which they have homes or run businesses. This in turn is part of our three-pronged approach to addressing the impact that large numbers of second homes and holiday lets can have on communities and the Welsh language. The views conveyed in the consultation, including from the wider tourism sector, clearly support a change to the criteria for self-catering accommodation to be classified as non-domestic. Responses indicated that genuine holiday accommodation businesses would be able to satisfy increased letting thresholds and a wide variety of possible alternatives were suggested. Increasing the thresholds will provide a clearer demonstration that the properties concerned are being let regularly and are making a substantial contribution to the local economy.

Following our consultation, we're of the view that self-catering properties let out on an infrequent basis should be liable for council tax. Increasing letting criteria will ensure that such properties are classified as non-domestic only if they're being used for business purposes for the majority of the year. I therefore announced our intention to amend the criteria from 1 April 2023 and now have launched a technical consultation on the draft legislation. That consultation did close on 2 April and the responses are currently being analysed. And I intend to publish a summary of those and announce the next steps soon. 

When the legislation is made, subject to any changes arising from the consultation, it will be accompanied by a regulatory impact assessment, and I do thank the Wales Tourism Alliance and other representatives for providing us with additional information, and we will be taking that into account in the impact assessment. 

Will you take an intervention?

Of course. 

Minister, I think the issue that I have, certainly from holiday let businesses in my own constituency, is that 180 days is just not sufficient to be able to fill their accommodation, given the fact that holiday lets are very difficult to let during the winter months. And to have 100 per cent occupancy for 182 days just doesn't seem a realistic proposition at all. I really would like a commitment from you today to give an assurance that this will really, properly be examined, because I think this is the big stumbling block. And many tourism businesses in the holiday let sector simply will have to have their properties transferred to business rates. They won't even be able to let them to residents as housing stock, because planning permission doesn't allow it, and the business will completely fold. I'm asking you really passionately, Minister, to really examine this with your officials, because I think there is a real issue here with this particular issue of 182 days. 

In response to Mark Isherwood earlier on in questions this afternoon, I did indicate that I'm taking some further advice following those discussions with the Wales Tourism Alliance in respect of the implications relating to planning in particular, and I look forward to receiving some further advice on that shortly. And then in terms of our overall approach, we do want to ensure that we consider businesses—those businesses that are making a substantial contribution to the local economy. And this legislation is aimed at addressing the issues that we do, I think, genuinely recognise in terms of properties across Wales just being underutilised, both in terms of the tourism sector and then not being available to provide housing for local people within these communities—being priced out, as in the contribution that we heard from the Plaid Cymru benches earlier on this afternoon.

We're also trying to extend the period of the tourism year in Wales. So, colleagues will be familiar with the 'This is Wales' tourism promotion work that we're doing, but we've also recently done 'This is Winter', which promotes the offers that we have here in Wales right throughout the winter season so that we can try to get Wales on the map for people as somewhere that you would visit not just in the summer months but that you can visit all year through. And we're also doing work to make sure that when international visitors, as they start to come back to the UK, are searching for holidays on the internet, looking for places to go in the UK, that Wales pops up as one of the first things that they see as a result of their searches on the internet as well. So, we're looking at a number of ways in which to promote Wales and Welsh tourism businesses and, as such, the tourism sector and the holiday let sector as part of that work. But, yes, we will be further considering the responses, now that we get to the technical consultation, as I described, and looking very carefully at the further evidence that the Wales Tourism Alliance did provide for us in terms of the consultation that it did with its members. 

Just to conclude, then, Deputy Presiding Officer, as part of the agreement that we have with Plaid Cymru, we are taking this immediate action to address the impact of second homes and unaffordable housing in communities across Wales, using a number of approaches. So, we're using the planning system, looking at property systems and taxation systems, and recognising of course that these are complex issues that do require that multifaceted and integrated response. Changes to local taxation alone clearly will not provide the whole solution, and that's why we are developing that wider package of interventions, and I would ask colleagues to vote for the Government amendment today. Diolch. 

I call on Sam Rowlands to reply to the debate. 

Thank you, Deputy Presiding Officer. I'd like to thank all Members from across the Chamber this afternoon who have contributed today. It's been a really important and, at times, a very impassioned debate about a really important sector here in Wales. In closing today's debate, I'd like to focus on three issues that I think have been brought to the fore amongst us, and first is the importance of tourism in Wales, as eloquently outlined by Tom Giffard in opening today's debate. As we know, Wales welcomes around 100 million visits every single year. These are people coming to our great nation, spending their money, supporting local jobs and enjoying our spectacular attractions. I was a little bit disappointed, actually, by Members not name dropping even more areas of outstanding natural beauty or attractions, but a few were mentioned today, and we do have already designated five areas of outstanding natural beauty, as well as, of course, the national parks across Wales and fantastic attractions. Three of those areas of outstanding natural beauty, of course, are in north Wales, some may argue that being the most attractive part of Wales, but I dare not mention that just now. Point 1 of our motion states we celebrate

'Wales's strength as a world-class tourist destination.'

I was amazed, actually, that Welsh Government chose to delete that part of our motion. Of all the parts of our motion, surely celebrating Wales as a world-class tourism destination, surely that's fairly harmless. I was disappointed that the Welsh Government decided to do that. That was the first thing. [Interruption.] Sorry, do you want to make—?

Will you take an intervention?

Certainly.

Thank you for taking an intervention. Absolutely—I think we all in this Chamber want to celebrate what we have to offer in terms of tourism. The difference here is between celebration, making the most of, and exploitation, and I actually welcome the dividing lines that have been made clear today. Conservatives, in everything you have said, seem to be very keen to see tourism as something to exploit Wales. My party is keen to support our communities in which tourism happens, and support tourism businesses that want to be profitable and sustainable. And I would invite the Member to reflect on some of the comments today that seem to be very, very indifferent to those communities that are very heavily affected by the tourism that happens in Wales.  

I think the Member is perhaps confusing our support for business and local economies and the impact that has on communities. So many tourism businesses support those very communities that you care about and we care about with equal passion.

The second point that I think was raised and outlined by Natasha Asghar in particular was the impact that COVID-19 had on our tourism sector here in Wales—lockdowns and restrictions saw a number of businesses shut down, while others struggled to stay afloat—and recognising the support those businesses received from the UK Government but also from Welsh Government in their outreach during that time, very difficult for those businesses.

Many Members, of course, were quite passionate about the ideas around the tourism tax, mentioned by Janet Finch-Saunders over Zoom there. James Evans, in particular, had very strong views that it's not a good idea for this sector here in Wales. As Members outlined, leading figures from across the tourism sector are unanimous in their thoughts that they do not support this tax being introduced. And outlined also by Natasha Asghar was, actually, already those businesses are paying above and beyond taxation through VAT compared to other countries. So, a further tax again is perhaps something that may not be helpful at this time. 

Janet Finch-Saunders referred to the number of people who are working in tourism-related industries—143,500 people here in Wales. Those very communities that Rhun ap Iorwerth is talking about, those very people in those communities, have been sustained by those jobs. And then, of course, also Tom Giffard brought in, in terms of a tourism tax, that, in some parts of the world, actually, it's being used to reduce tourism. Now, sustainable tourism, we all would agree that that is needed and important for us, but sustainable tourism does not mean fewer visitors or fewer tourists. It doesn't mean fewer businesses. It actually means doing it in a way that includes our communities, and also ensures we have a great experience for our tourists to visit time and time again. I was pleased, of course, that even Mabon ap Gwynfor was able to say how important the sector is to the economy here in Wales. 

I think the final point, Deputy Presiding Officer, that of course was discussed at great length, and rightfully so, is the proposed changes from Welsh Government on the non-domestic rating system and the impact that this will have on many holiday letting businesses. Russell George's interventions were particularly passionate on this issue—on an important day for Russell George, actually, today, I believe. But it is a very serious issue that certainly needs to be addressed.

The criteria for self-catering accommodation being liable for business rates moving up to 182 days—so many existing businesses are saying that they will not be able to achieve that. It's perhaps a technical issue, but a very important issue, about so many of those businesses then folding, and those properties not being able to be used for anything else and then lying there empty. It seems like something that a Government—. I appreciate the Minister's comments in terms of reflecting on that issue.

Tom Giffard mentioned that, in the cross-party group on tourism that took place last month, this issue was discussed with Welsh Government officials. I'm grateful to them for their attendance at that meeting. It's clear that the Welsh Government's proposed changes would be significantly detrimental to the livelihoods of many people, and I certainly hope that those comments will be considered seriously.

So, in closing, Deputy Presiding Officer, we need to remember that now is the time to encourage enterprise and business here in Wales. We need to encourage people to visit Wales and spend their money in our businesses, sustaining those jobs and those communities that are so vitally important. Visitors to Wales spend significant sums and invest significantly in our country, benefiting our local economies, from hoteliers to restaurants to those who run incredible attractions up and down Wales.

I cannot stress enough how important this industry is to our country: 145,000 jobs sustained because of it. Now is the time to celebrate this sector and appreciate that people from across the world come to choose Wales as a place to visit. In today's debate, we have a fantastic opportunity to show the tourism sector that we are on their side, we recognise the exceptional work that they carry out in providing jobs and how important it is to the Welsh economy. So, today I urge everyone to support our motion in front of us. Thank you very much.

The proposal is to agree the motion without amendment. Does any Member object? [Objection.] There is objection. Therefore, I will defer voting on the motion until voting time.

Voting deferred until voting time.