An inquiry into cultural investment in cities has called for a UK-wide review of the benefits of a tourism tax.

The Cultural Cities Inquiry has said a tourist levy could make a significant impact on investment in culture in the context of widespread Government budget cuts.

Tourism taxes already exist in cities around the world, but the UK is yet to introduce them.

The 10 cities that make up the Core Cities group, including Cardiff, Glasgow and Manchester, estimated that a £1 per night levy could generate more than £30m per year.

A similar levy in Oxford could raise £5m a year, according to estimates, and in Edinburgh a £2 levy could bring in £2.5m during the festival over the summer.

The inquiry has suggested a nationwide review should now be launched to assess the impact these levies could have on cities and local authorities.

Cardiff City Council leader, Huw Thomas, said: ‘Sports, culture and the creative industries have become a major part of what makes Cardiff such a great place to live – but we need new channels of investment to sustain and grow this sector.’

Senior Whitehall civil servants have previously suggested that the Government could be open to a tourist levy.

Hackney LBC has introduced a voluntary tourism tax while Birmingham is considering a tourism tax ahead of the Commonwealth Games in 2022.

However, a tourism levy is likely to cause controversy within the hospitality sector.