In its Programme for Government 2022-23, published on 6 September 2022, the Scottish Government announced the introduction of legislation for two new Scottish taxes, the Local Visitor Levy and the Scottish Aggregates Levy.

Local Visitor Levy (Tourist Tax)

Also known as the Tourist Tax, the Local Visitor Levy will give local authorities in Scotland a discretionary power to apply a levy on overnight visitor stays in all or part of their area, to help fund relevant local activities and services. The Scottish Government indicated that the levy would give councils 'additional fiscal flexibility' which would help councils fund activities relating to tourism and related infrastructure.  

The Scottish Government consulted on the principles of a Transient Visitor Levy in 2019 but work on the levy was halted as a result of the COVID - 19 pandemic. In the Scottish Budget 2022-23 the Scottish Government confirmed that work on the levy would recommence, though a careful review of the work done to date, and further engagement with stakeholders has been necessary as a result of the continuing impact of the pandemic on the tourism sector in Scotland.  

Edinburgh is set to be the first local authority to charge the new tax, and has previously proposed a levy of £2 per night, capped at £14 per visitor. The legislation is expected to be introduced to the Scottish Parliament early next year, but the earliest the levy could be introduced is 2026.

Scottish Aggregates Levy

The power to devolve Aggregates Levy to Scotland was included in the Scotland Act 2016, but the introduction of the Scottish levy was delayed due to long standing litigation and subsequently by a review of the UK levy.

The new Scottish legislation will set out the key arrangements for the devolved Scottish tax, including the scope of the tax, the rates of levy payable as well as reliefs and exemptions. Scottish Aggregates Levy will be collected and administered by Revenue Scotland.

Scottish Aggregates Levy will replace UK Aggregates Levy on the the commercial exploitation of aggregates in Scotland from 2026.

Other devolved taxes - LBTT and SLfT 

Scottish Aggregates Levy will be the third fully devolved Scottish tax. Land and Buildings Transaction Tax (LBTT) replaced SDLT on transactions involving land in Scotland from 1 April 2015, and Scottish Landfill Tax (SLfT) applies to the disposal of waste to landfill in Scotland also from 1 April 2015. 

Still to be devolved - Air Departure Tax

Air Departure Tax (ADT) is Scotland's planned replacement for Air Passenger Duty. The Scottish Government remains committed to the introduction of ADT when a solution to the Highlands and Islands exemption issue has been found. Original proposals involved reducing the rates of ADT, however following advice from the UK Committee on Climate Change in 2019, and the 2045 target for net-zero emissions adopted as a result, the Scottish Government has concluded that the economic benefits from a policy of reducing ADT were not compatible with the new emissions targets.  


Isobel d'Inverno

Director of Corporate Tax

Scott Bell

Senior Solicitor