Cruise tourism is vital to Scotland, so don’t risk a levy on passengers - Rob Mason
As the Scottish Government is set to host a series of consultation events this month to discuss the cruise visitor levy with the Scottish cruise industry, Rob Mason, Chair of Cruise Scotland, reflects on the potential impacts of this tax and the importance of the cruise business to the country’s economy.
There has been a lot of comment recently about cruises and about the proposed cruise visitor levy being considered by the Scottish Government which will, if implemented, tax the thousands of cruise passengers who arrive at the ports and harbours across Scotland.
As a business operator I can see the economic attractions of this. However, we should be aware of the real risk that cruise ship operators may choose to avoid Scotland in their future itinerary planning. This would be a major economic blow to the local areas and to Scotland as a whole.
Cruise tourism brings great benefits to Scotland and is integral to our visitor economy. The industry supports thousands of jobs across Scotland as well as bringing significant local economic benefit. Last year, cruise generated more than £130 million for the Scottish coffers. Meanwhile, for every 24 cruise passengers, one full-time job is supported either in the supply chain, local businesses at cruise destinations or travel agents.
The cruise industry currently supports the Scottish economy by generating existing taxes and duties. These include ship and passenger taxes, port fees and mooring costs, plus VAT charges on goods and services. The industry is also subject to rigorous carbon pricing regimes, including the UK Emissions Trading Scheme (UK ETS), which are specifically designed to improve environmental performance.
More locally, each cruise passenger spends an average of £100 a day which benefits local tour guides, restaurants, shops, taxis, tourist attractions and a range of other small businesses. In addition to this, local ports also benefit from the onshore spend from the ship’s crew, often in clothes stores, supermarkets, cafes and pharmacies. Further afield, cruise passengers provide revenue for tourist attractions up to 90 minutes away from the port. In this way, cruise passengers contribute substantially to the Scottish economy, without burdening city infrastructure and services.
Cruise ships bring tourists to Scotland from all over the world. They visit coastal communities around the country that tourists rarely visit. The industry often extends the tourism season for many of these remote locations and, with cruise line itineraries planned at least two years in advance, this provides added stability to local economies and businesses that rely on the cruise calls.
Cruises benefit tourism as a whole too as more than 60 per cent of cruise passengers will return to a destination that they visited on a cruise and six in ten cruise passengers return to the destination later for a land-based trip.
Cruise holidays are not everyone’s choice. However, it is a globally successful industry with cruise lines viewing Scotland and the UK as a top destination. The current economic benefits that cruises bring cannot be overlooked. A visitor levy could impact this, and Scotland should consider whether it wants to continue to grow the benefits of cruise tourism and work with the industry to do so in a sustainable way, and whether it wants Scotland to remain competitive in both the regional and international cruise market.
Let’s not forget that cruising was the tourism sector hardest hit by Covid and it has taken the longest to recover. 2023 was the first year that passenger levels returned to pre-Covid levels. We don’t want to stifle this recovery and future growth of the industry here in Scotland. We need to ensure that Scotland’s worldwide reputation for the warmth of our welcome is maintained and is not damaged by additional taxation.
Rob Mason, Chair of Cruise Scotland