Islington Council’s decision to introduce a late-night levy (LNL) has provoked fears that it will put existing local best-practice schemes in jeopardy.

Last week, the council became the first in the capital to vote to introduce the tax, which has already been implemented in Newcastle and will come into force in Cheltenham next month.

The levy will apply to all premises in the borough that are licensed to sell alcohol from midnight until 6am (approximately 457 out of 1,300 premises), with a 30% reduction granted to premises operating in a best practice scheme. It will commence no earlier than 1 September 2014.

However, Christine Lovett, director of Angel Business Improvement District (BID) said nearly half of the BID levy (£200,000) raised each year is already spent on policing and she is “very disappointed” the 28 operators signed up to the voluntary scheme will not be exempt.

“I understand that we need to tackle the problem of irresponsible drinking, but that comes through education and working with other businesses. That doesn’t come from double taxing the Angel BID businesses,” she said.

“[Licensees] can decide to vote against a BID when it comes to re-election, which has always been my concern. When you’re paying for policing, you don’t want to be paying for it twice.”

Patrick Donnelly, Angel Pubwatch chair and owner of Slim Jim’s bar on Upper Street, added: “We felt we put in a good argument and we do a good job and [the council] haven’t listened to anything we said. You just have to look at statistics from the police — crime is down. This is down to having the dedicated Angel business police team and a well-managed late-night economy.”

Association of Licensed Multiple Retailers strategic affairs director Kate Nicholls also warned: “There is a danger that businesses will not vote in favour of the BID for fear of paying twice.”

Industry figures had also expressed fears that 70% of the levy money raised would go to the Metropolitan Police, as normally required, and therefore there would be no guarantee it would be invested in Islington.

However, Islington Council said all of the money will be pooled by the local police and council, who will jointly decide how to spend it in the borough.