Cambridge City Council are considering charging hotel guests a £2 per night tourist tax to improve investment.

According to a proposal presented to the council this week, visitors to hotels with over 10 rooms would pay the “visitor levy” of between £2-£3 per room per night.

The levy could come into place from the beginning of 2025.

Guests in AirBnb and self-catering accommodation would not be subject to the tax, which also would not apply to University colleges charging for bed-and-breakfast accommodation, due to their status as educational institutions.

However, the council said: “A voluntary agreement is being explored with the relevant colleges to cover the times of the year when they let rooms on a commercial basis.”

The tax could raise between £1.5m and £2.6m annually according to the proposal.

This money would be used as part of an Accommodation Business Improvement District (ABID) and invested into “improved management of the visitor economy in Greater Cambridge”.

The measure would follow similar schemes in European cities, including Manchester, which charges hotel visitors £1 plus VAT per room per night.

The proposal is subject to consultation with hoteliers and stakeholders. Jemma Little, economic development manager at Cambridge City Council, told the Council’s Strategy and Resources Committee that there would need to be a ballot of hotels which would be affected.

She said: “Initial discussions with businesses out of the existing BID area have been constructive and will continue over the next month.”

Cameron Holloway, a Labour councillor, said: “I think it’s a great initiative and one that would be really positive for the city.”

The council voted unanimously to progress development on the levy.