SCOTLAND’S largest local authority is to investigate proposals for a tourism tax which supporters say could generate a minimum of £4 million a year.

Glasgow City Council is setting up a cross-party working group to examine how a “Transient Visitors’ Levy” could be implemented, gather the views of residents and businesses and consider how the money could be spent. It is due to hold its first meeting later this year.

The development follows a call made to the full council earlier this month by Labour’s Malcolm Cunning which received the backing of his party as well as the SNP and Greens.

His motion urged the council will write to Scottish Government Finance Secretary Derek Mackay expressing “full support for the principle of local authorities having the ability to implement ‘ad hoc’ revenue raising measures that fit their local circumstances, of which the Transient Visitor Levy is one example”.

Cunning said a levy set at £1 per person per night could raise a minimum of £4m for Glasgow annually.

“£4m would be the absolute minimum that could be raised and the money could be spent on maintaining the museums and attractions visitors flock to and enhance the tourism experience,” he told The National.

Councillor Susan Aitken, leader of Glasgow city council, said: “There is cross-party support on Glasgow City Council for the principle of local authorities being able to raise their own revenue through the application of ad hoc, local taxation mechanisms. ‘‘A Transient Visitor Levy is only one example of a range of local taxation options, which councils may or may not wish to adopt according to their own circumstances.”

Scottish Greens councillor Jon Molyneux said the working group would also examine a need for wider local taxation powers such as levies on vacant and derelict land.

“From all perspectives it is important the group should have a remit broader than just the tourist tax. We are pushing for a number of ways in which the Scottish Government could move on local finance and powers. A tourist tax alone is not enough,” he said.

Around two million people visit Glasgow every year with the tourism sector estimated to be worth around £500m to its economy, creating 30,000 jobs. World-leading events have included sporting events such as the European Championships this year and the Commonwealth Games in 2014.

Some form of tourist tax is already in place in many European cities. Athens, Paris, Rome and Florence use a “progressive visitor levy” which charges a higher tax for a higher class of room. Rome charges €7 for a five-star room and €4 for a three-star room. Edinburgh City Council confirmed detailed proposals for a £2 per person per night tourist tax last week which it said would bring in an extra £11m a year.

Local authorities currently do not have powers to introduce a new visitors’ tax and want the Scottish Government to bring in legislation which would enable them to do so.

The First Minister said on Thursday that while the tourism tax was “not currently Scottish Government policy”, ministers would listen to all views on the on the table and consider them as they approached this year’s budget.

Nicola Sturgeon was already facing calls to act on the matter after the SNP-controlled Edinburgh City Council put forward plans this summer. She is now likely to be under further pressure following Glasgow’s new working group on the issue.

Cosla’s resources spokeswoman Councillor Gail Macgregor welcomed the development in Glasgow.