Commentary on Provisions Part 3 – Introduction and Administration of the Levy Section 14 – Required content of a scheme
34.Section 14(1) sets out the elements which a local authority must include in a VL scheme, including the area in which the scheme will operate, the date the scheme is to come into force, the percentage rate of the levy (which is set by the local authority under section 6, and subject to any maximum percentage rate set by regulations under section 6(3)), the scheme’s objectives and arrangements for the review of decisions taken by the authority in relation to the scheme. The scheme must also specify when, during the period of the scheme, a purchase of the right to reside in or at overnight accommodation is to give rise to the levy. This might be the whole of the scheme period. Or it might be a different period or periods. For example, it might specify particular dates in a calendar year or seasonal periods (for example, the period ‘beginning with the first Monday in April and ending with St Andrew’s Day’). The scheme must also specify cases or circumstances where the levy (or a sum equivalent to the levy) is not payable or is to be reimbursed (subsection (1)(h)). While the cases or circumstances in which the levy is not payable or is to be reimbursed are broad and may generally be determined by the relevant authority, subsection (1)(i) imposes a compulsory exemption. Subsection (1)(i) requires the scheme to specify that the levy (or a sum equivalent to the levy) is not payable where the visitor or any other person utilising the right to reside in an overnight accommodation is in receipt of specified disability benefits, payments or allowances (subsection (1)(i)). The specified disability benefits, payments or allowances are:
	The disability living allowance (see Social Security Contributions and Benefits Act 1992, section 71),
	Disability assistance for working age people (see Social Security (Scotland) Act 2018, section 31),
	The attendance allowance (see Social Security Contributions and Benefits Act 1992, section 64),
	The pension age disability benefit for older people (see Social Security (Scotland) Act 2018, section 31),
	The personal independence payment (see Welfare Reform Act 2012, Part 4).
35.In order to facilitate the application of the exemption or reimbursement for the specified disability benefits, payments, or allowances, the scheme must also set out arrangements for the administration of the exemptions or reimbursement, including the evidence required and how it may be demonstrated that the person receives the relevant benefit, payment or allowance (subsection (1)(j)). Subsection (2) requires that for the purposes of subsection (1)(h), the scheme must also specify whether one of the cases or circumstances in which the levy (or a sum equivalent to the levy) is not payable or may be reimbursed is that the accommodation business has an annual turnover below the VAT threshold (defined by reference to the amount specified in paragraph 1(1)(a) of schedule 1 of the Value Added Tax Act 1994). This is not a required case or circumstance where the levy (or a sum equivalent to the levy) is not payable or may be reimbursed, but it requires the authority to explicitly state whether businesses with annual turnover below the VAT threshold are captured.
36.The effect of subsection (3) is that a local authority may not bring a VL scheme into force or have a significant modification of a VL scheme take effect until at least 18 months after the date on which the local authority decides to introduce or significantly modify a scheme (i.e., 18 months after the date on which a local authority publicises a report under section 13(1)(c) stating that it intends to proceed with the original or modified proposal to introduce or modify a VL scheme). A “significant modification” is defined in subsection (4) as a modification which expands the scheme area, increases the percentage rate(s) of the levy, or removes any cases or circumstances in which the levy (or a sum equivalent to the levy) is not payable or is reimbursed. Any other modifications may come into force on a date specified after the local authority publishes a report under section 13(1)(c) stating that it intends to proceed with the original or modified proposal (subsection (5)).
37.Subsection (6) contains a regulation making power allowing the Scottish Ministers to amend subsection (1) to add to the list of the mandatory elements of a VL scheme, or to remove or vary the list (except paragraph (e) – the percentage rate or rates set by the authority under section 6). The Scottish Ministers may also by regulations amend subsection (4) to add to, remove, or vary the types of modifications which are to be considered significant (subsection (7)). Before making regulations under this section, the Scottish Ministers must consult local authorities, such persons as they consider to be representative of communities, businesses engaged in tourism and tourist organisations, and such other persons as they consider appropriate (subsection (8)). Regulations under this section are subject to the affirmative procedure (subsection (9)).