Visitors could be required to pay a tourism tax when staying overnight in Wales.
The Welsh Government is introducing legislation to give councils the power to apply a visitor levy to accommodation bills.
Anyone staying in a hostel or on a campsite pitch would pay 75p per person per night, while it would be £1.25 per person per night for people staying in all other accommodation types, such as hotels, Airbnbs and self-catering properties.
The Welsh Government estimated that the levy could generate up to £33 million a year if all Welsh local authorities introduce it.
Ministers said the levy would raise money to spend on local tourism activity and infrastructure.
The Visitor Accommodation Bill will also include a registration scheme for accommodation providers.
It will need the Senedd’s approval and councils may only introduce it by 2027.
Visitor levies are used successfully in many parts of the world, including Manchester, Greece, Germany, Netherlands, Spain, Portugal and California.
Finance Secretary Mark Drakeford said: “This Bill is rooted in the principle of fairness.
“We know tourism makes an important contribution to the Welsh economy and to Welsh life. We want to ensure its long-term sustainability.
“That’s why we believe it is fair visitors contribute towards local facilities, helping to fund infrastructure and services integral to their experience.
“Visitor levies are common around the world – benefiting local communities, tourists and businesses – and we want the same for Wales.
“Money raised through a levy would be retained by local authorities and reinvested back into their local areas to support local, sustainable tourism.
“It’s a small contribution that could make a big difference.”
A statutory registration scheme for all accommodation providers is expected to start operating in 2026 to support the collection and administration of a visitor levy.
It will include details about who is operating in the sector, where and how they are operating, help to establish a better understanding of the sector and support future policy decisions at a local and national level.
Councillor Andrew Morgan, leader of the Welsh Local Government Association, said: “This Bill will give councils the option to introduce a visitor levy on overnight stays.
“It’s a way to raise extra funds to support local services and improve amenities that benefit both visitors and the community.
“Each council will decide how to apply the levy based on what’s best for their area, recognizing that it may be suitable in some parts of Wales but not in others.
