Australians love travelling to the UK. They could soon have to pay more

For the 1.2 million Australians who travel to the UK every year, the bill is about to get steeper, as UK mayors will soon have the power to charge a so-called "tourist tax" on accommodation.

Last week the British government announced it was going to be pressing ahead with the controversial levy which Prime Minister Andy Burnham — the so called "King of the North" hopes will help move power and money way from London.

Called the "Overnight Visitor Levy," it gives regional mayors the option to tax people on a percentage of their stays at hotels, bed and breakfasts and other types of accommodation.

Burnham— who replaced Keir Starmer as prime minister in July— sees the levy as a way of financially empowering regional cities.

He said last week the tax would come into force towards the end of the next financial year, with mayors expected to set out spending plans for the funds raised by early 2028.

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The levy will be set at the discretion of city councils but on Friday Labour mayors in 10 regional cities said they would cap the charge the charge at five per cent, following widespread concerns from the hospitality industry that the levy would dampen spending.

An exact date for the levy's introduction has not been announced but Burnham said the tax would come into force towards the end of next financial year and apply to both Britons and international tourists.

The exact terms of the levy could vary from city to city, but mayors in London, Greater Manchester, Liverpool City Region, West Midlands, North East, West of England, West Yorkshire, South Yorkshire, East Midlands and York and North Yorkshire have all agreed to the five per cent cap.

Two Reform UK mayors and two Conservative party mayors have said they would oppose any levy — so its possible the price of accommodation will go up in some cities, but not others.

While the five per cent levy would be new for regional cities in Britain, it's not a UK first.

In July, Edinburgh launched a 5 per cent levy on accommodation that's capped at five nights and similar taxes are already common around the world.

New York, LA, Brussels, Amsterdam, Toronto and Montreal all have their own equivalent charges.

Wales is set to introduce it's own £1.30 per person per night levy in April of next year.