How to Start & Run a B&B BandBED2eBook-1 | Page 59

Submission by the Bed and Breakfast Association to the Lyons Inquiry
Your Consultation Paper and Interim Report of December 2005 invites submissions from
interested parties as part of the consultation process which will contribute to your final
report on local government finance.
This submission is from the Bed and Breakfast Association (BBA), the trade association
for bed and breakfast owners in the UK, and addresses the issue of “tourist-related
taxes” referred to from clause 2.98 on page 76 of your Interim Report, specifically “a
local tax on hotel and similar accommodation”. You say that you are “interested in
exploring this issue further” (although we note that you add that “considerable further
work would need to be undertaken if new forms of taxation were to be contemplated”).
We believe that a tourist tax of the sort mooted in your report would be highly
damaging to UK tourism, both inbound and domestic, and would be especially and
disproportionately damaging to the B&B sector; that such a tax would be
counterproductive and would depress total tourism-related revenue to the exchequer
more than the amount raised by the tax; and that the introduction of such a tax would
result in the closure of significant numbers of B&B businesses, especially in rural areas
with already weak economies.
The BBA was constituted in late 2005 to represent the UK’s bed and breakfast sector;
previously no organisation represented this sector. The British Hospitality Association
(BHA), for instance, represents the hotel and restaurant sector and has no significant bed
and breakfast membership.
The BBA represents B&Bs serving the leisure (tourism) and business markets, not the
multi-occupancy establishments often referred to as “bed and breakfast
accommodation” used by some local authorities as temporary housing for
disadvantaged people.
The B&Bs represented by the BBA typically have three letting bedrooms or fewer, and
are owner-managed businesses carried on in the owners’ homes.
The bed and breakfast sector in the UK has suffered in the past as a result of a lack of
consultation by Government, which has in turn resulted in the impact on our sector of
new legislation being under-estimated or overlooked.
Although the bed and breakfast sector is fragmented and consists of very small
individual businesses, overall it forms a highly significant part of the UK’s tourism
bedstock; in 2003, stays at B&Bs represented 7% of stays and 8% of spending on
domestic tourist stays by UK residents, compared to 29% of stays or 41% of spending
being in hotels. So for every four hotel stays taken, there was one stay in a B&B in 2003.
The stays in B&Bs represented £1.849 billion of tourism spend in the UK made by UK
residents alone, a figure hugely increased once spend by foreign visitors to UK B&Bs are
added.
(UK Tourism Survey)
The above figures underestimate the relative importance of the B&B sector in rural
areas, where a higher proportion of bedstock will be represented by B&Bs as compared
with hotels. In many of the UK’s most sparsely populated and economically weak