A tax on visitors staying in Edinburgh would cut tourism revenues by £93m and put more than 2,000 jobs at risk every year, a hotel boss has warned.
A hotel "bed tax" is being proposed for Edinburgh
A Scottish Arts Council report out earlier this week suggested a "bed tax" could be a possible source of extra funding for the city's festivals.
But Grant Hearn, head of hotel chain Travelodge, believes the move would put Scotland's tourism industry at risk.
He said the extra costs would deter visitors from travelling to the city.
Grant Hearn, Travelodge chief executive, said the bed tax idea was "unfair" and "illogical".
He said: "Who do they suppose buys tickets to attend the festivals in the first place? It is tourists.
"And they aren't going to come if higher prices and taxes make Edinburgh and Scottish tourism in general more expensive.
"This means maintaining a tourism product that is value for money and affordable.
"I urge the Arts Council and the Scottish Executive to reject a half-baked idea that undermines, rather than supports, Scotland's worldwide reputation for tourism and culture."
The levy was proposed in the Scottish Arts Council commissioned study, called Thundering Hooves, which listed 14 recommendations.
The study looked at the threat to Edinburgh's unique status from other festivals across the globe and called on the council to increase spending by more than £8m each year to allow its festivals to compete.
Figures from Scottish tourism body VisitScotland show the industry currently employs 200,000 people and brings £4.4bn into the country's economy each year.
A VisitScotland spokeswoman said: "The issues around local government funding are complex and it is important that all options are carefully considered, including bed tax."