Scotland to regulate holiday lets through compulsory licensing scheme

The Scottish government plans to regulate short-term lets through a compulsory licensing scheme and new powers for local authorities to control holiday rentals.

The licensing scheme will include safety requirements covering “every type of short-term let”, with councils given “discretion to apply further conditions to address the concerns of local residents”.

Local authorities will be able to “designate control areas to ensure planning permission will always be required for the change of use of whole properties for short-term lets”.

MoreCall for 2.5% Scottish tourist tax attacked as ‘flawed’

In addition, the Scottish government announced it would “urgently consider how short-term lets will be taxed to ensure an appropriate contribution to local communities and [to] support local services”.

The government said the tax on holiday rental properties would “complement” its plans to introduce a Transient Visitor Levy Bill “later in this Parliament”.

Edinburgh city council has been campaigning to introduce a transient visitor levy, or tourism tax, for some time.

Housing minister Kevin Stewart introduced the measures in the Scottish Parliament on Thursday saying: “In certain areas, particularly tourist hot spots, high numbers of short-term lets are causing problems and often make it harder for people to find homes.

“We are empowering local authorities to implement a system that works for their area.

“By giving councils the power to set conditions around short-term lets licences and put in place planning control areas to tackle hot spots, communities will be able to decide what is best for them and their local economy.”

Stewart said: “The licensing scheme includes a safety element which will be mandatory across Scotland for all short-term lets.

“Separately, local authorities will be given discretion to include further conditions to help tackle littering or overcrowding of properties.”

Home sharing – defined as “renting a room in your own home or allowing others to stay in your own home while on holiday” – will not be affected by control areas.

The Scottish government noted its consultation on a regulatory framework for short-term lets last year drew more than 1,000 responses, the majority supporting regulation.

Willie Macleod, executive director for Scotland at the UKHospitality association, said: “We’re pleased to see the Scottish government bring in long-overdue registration and powers to control the massive and uncompetitive growth in largely unregulated short-term letting.”

Macleod argued: “The recent boom in short-term lets has brought a plethora of problems for residents and a raft of debatable business practices.

“Too many businesses have an unfair advantage compared to hotels and other accommodation businesses, escaping business taxes and sometimes operating without important safeguards in place.

“This undermines hospitality businesses which have already been hammered by rising costs and potentially puts customers at risk.”

He added: “We are pleased to see these businesses will not be exempt from any tourist tax and await further detail.”


Share article

View Comments

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.