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How does Edinburgh use its visitor levy for housing?
Edinburgh introduced a 5% visitor levy on overnight stays in July 2025. The city plans to use the revenue, forecasted to reach £100 million over three years, to fund nearly 500 affordable homes. The initial funds are allocated to a housing mitigation fund supporting 472 affordable homes, aiming to address housing shortages and support residents and workers in the tourism sector.
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Are visitor taxes a good model for other cities?
Yes, Edinburgh's approach is seen as a potential model for other cities, especially as Scottish legislation now grants councils more flexibility to design visitor levies. Cities like Glasgow and Aberdeen are planning similar schemes, which could help generate sustainable funding for urban development and affordable housing projects.
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Can tourism revenue really solve housing shortages?
Tourism revenue from visitor taxes can contribute significantly to funding affordable housing, but it is usually part of a broader strategy. While these taxes provide a dedicated source of income, addressing housing shortages also requires comprehensive planning, investment, and policy support.
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What are the challenges of using tourism taxes for housing?
One challenge is ensuring that the revenue generated is sufficient and sustainably managed. There can also be political debates about whether tourism taxes unfairly impact visitors or local businesses. Additionally, the effectiveness depends on proper allocation and oversight of the funds to ensure they directly benefit housing projects.
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Are other cities successfully using tourism money for housing?
Yes, besides Edinburgh, cities like Glasgow and Aberdeen are planning or implementing similar schemes. The success of these initiatives will depend on local governance, community support, and transparent management of the funds to ensure they effectively address housing needs.