The owners of a Powys B&B that was named one of the best in the UK have claimed that the Welsh Government’s proposed tourism tax will affect the long-term viability of the business.

Michael and Diane Dean have had their plans approved by Powys County Council to revert The Old Vicarage, a four-star bed and breakfast business in Llangurig, near Llanidloes, back into a family home before they retire at the end of the year.

Since taking over the B&B business in 2019, the owners said they have had to deal with the "direct effect of the pandemic and subsequent economic impacts, including significant changes in utility costs".

READ MORE | Llangurig B&B lands top hospitality accolade

"These in themselves have affected the long-term viability of the business, alongside Welsh Government policies such as proposed tourism tax and tourism business licensing,” Mr and Mrs Dean said in a planning application submitted to the council in late August.

“It is pertinent that both owners wish to remain in a house and location where they are happy and contribute significantly to the local community.”

The property was constructed during the 1860s as the vicarage for St Curig’s Church. It was sold in 1967 as a private residence until 1982 when planning permission was given for change of use to a private guest house.

The couple took over The Old Vicarage in September 2019, having previously run a guest house in Llandudno in North Wales.

During the pandemic, The Old Vicarage was awarded a Recognition of Excellence by HotelsCombined, owned by Kayak and Booking.com, for its consistently high guest reviews.

READ MORE | Award-winning Powys hotel and restaurant to close its doors

The proposal put forward by Mr and Mrs Dean said: “The Old Vicarage offers only four bedrooms and so does not represent a significant amount of tourism accommodation.

"Other tourism accommodation in the area has increased significantly in recent years - including, for example, the development at Felin Fawr Lodges, glamping sites, and independent accommodations listed on online agencies like booking.com and Airbnb.

“Therefore, the loss of accommodation would be minor within the overall local offering. Importantly, the change of use will not structurally affect the property as no physical alterations are required.”

READ MORE | Powys guest house owners thank 'amazing' community as they announce departure

Planning officer Luke Woosnam approved the plan last week. In a decision report, he said on behalf of Powys County Council: “It is recognised that this is a small bed and breakfast business with four guest rooms which is rather small.

“The local planning authority (LPA) also recognises the increasing number of holiday tourism businesses not only in close proximity to Llangurig, but Powys as a whole, and doesn’t consider this change of use would detrimentally affect its location or surrounding area. The LPA considers this demand would be absorbed by other local holiday sites.”

The proposed Tourism Tax aims to give local authorities, such as Powys County Council, powers to introduce a visitor levy. The Welsh Government says the money raised would “support sustainable tourism, helping our communities and preserving the beauty of Wales for future generations”.

'Anti-business policy'

Montgomeryshire's Conservative MS Russell George described the proposed tourism tax as an "anti-business policy".

‘’I was very sorry to hear about the closure of this business. This situation was what I initially feared and the clear message from this closure is that the proposed tourism tax is going to be hugely detrimental to the tourism industry.

‘’Our hospitality businesses are first class and are one of the unique selling points about Montgomeryshire.  The tourism sector needs more support following the impact of the Covid-19 pandemic, not policies that could drive visitors away.

"As Welsh Conservatives, we brought forward a Senedd motion calling on the Labour Government to scrap their tourism tax and reduce the 182-day occupancy threshold to 105 days, along with other proactive measures to support our vital tourism sector.  Sadly, the Welsh Government are pressing ahead with this anti-business policy.’’

'Policy is designed to strike a balance'

A spokesperson said on behalf of Montgomeryshire and Glyndwr's Labour MP Steve Witherden: "Steve understands how important tourism is massively important to the Welsh economy and our local economy too.

"He believes there is a balance to be had between protecting communities from the adverse effects of overtourism - such as pricing out local people from the housing market and creating an unbalanced seasonal economy - while not unnecessarily penalising holiday let owners in less affected areas. The policy is designed to strike this balance."

"The Welsh Government has made clear that any decision on implementing a visitor levy will ultimately be made by councils, and decisions on how to spend funds raised will be made by councils too.

"Steve would hope this means any future levy in Powys could be lower than elsewhere in Wales, as was the case with increased council tax on second homes - Pembrokeshire put in place a 200 per cent premium, and Gwynedd a 150 per cent premium, while Powys’ was only 75 per cent, reflecting a lower proportion of second homes due to a smaller share of visitors.

"The policy is designed to allow councils to protect communities while still encouraging tourism."