SCOTLAND’S capital city is seeking to forge a unique tourist tax alliance with London in an attempt to push forward plans for a levy on visitors.

Council chiefs in Edinburgh have approached the office of London Mayor Sadiq Khan to suggest joining forces in a cross-Border effort to persuade Westminister and Holyrood to hand over local tax- raising powers.

At the same time it has emerged that Scottish local authorities are to deliver a call to the Scottish Government to introduce discretionary tax powers that could see motorists, shoppers and businesses hit by a range of extra local charges.

Dubbed “lifestyle taxes”, the move could lead to councils introducing local individual levies on goods, services and vehicles. Cash-strapped local authorities agreed to make the move following a meeting hosted by council umbrella organisation Cosla.

They argue it is necessary to help raise millions of pounds to pay for services affected by cash shortages and are also calling for an end to the three per cent cap on rises to the existing council tax system.

If accepted by the Scottish Government it could open the door to local authorities with a strong tourism industry – such as Edinburgh and the Highlands – to impose a tax on visitors, target drivers or impose extra tax on alcohol or unhealthy food.

Edinburgh City Council has already confirmed that it wants powers to impose a levy on businesses which have company car parking facilities and on “gas guzzler”

vehicles entering the city.

It is also preparing to step up its demands to impose a tourist tax with a period of high-profile activity planned for early 2018.

It is expected councillors will highlight the massive influx of tourists over the festive period, and the 4.5 million attracted to the capital by its flagship events every year.

Edinburgh Labour group leader, Councillor Cammy Day said an Edinburgh tourist tax is supported by festival chiefs and backed by leading hoteliers. He added: ”We have made a formal application to Sadiq Kahn’s office to look at any potential for a joint initiative for London and Edinburgh, as the two capital cities, to work together.

“The idea is to show that this is not just Edinburgh calling for this and that if both capital cities are calling for it, then it is of real benefit. We have had £20m plus cuts this year and will have more than double that next year, so we have to take a serious look at what we can fund.”

Edinburgh has campaigned in the past for the right to introduce a levy of between £1 and £4 – dependent on the accommodation and time of year – arguing that it would boost the economy by £15m. However, its previous attempts to become the first city in the UK to impose a tourist tax failed amid concerns from business leaders it could chase tourists from the city centre.

A Cosla spokesman confirmed council leaders agreed to make a call for discretionary tax-raising powers in response to concern over funding for essential services.

He added: “These would be discretionary taxes, local to the area and as part of a raft of measures. Not every area would be able to introduce a tourist tax, but some big cities might see that as an option.”

Alison Payne, research director of Reform Scotland, welcomed a move towards discretionary taxes: “We believe that as well as discretionary tax powers, that council tax and business rates should be devolved so local authorities can make decisions and be answerable to the local electorate.”

A Scottish Government spokesman said: “We remain committed to making local taxation more progressive, while improving the financial accountability of local government. We are open to further dialogue on options for reform.”