Professor Alan Barrett:

The issue of hypothecated taxes is a really tricky one. As a general principle, economists are completely against them for the simple reason that when the state gets a quantum of money, what dictates how it spends that money should be where it will get the best return on that money, not linking it very narrowly with particular things. Instinctively, economists are always against it. The flip side of that is that we all recognise that the political acceptability of certain things can often be increased if people see that they are paying or foregoing a particular tax and it is being directed in a particular way. There are two sides to that. If it gets down to the very micro details of giving grants to specific hotels and regions, it strikes me as a level of micro-engagement that I cannot imagine the officials in the Department of Transport, Tourism and Sport being very enthused about.