The fee will be implemented on 1 April 2015 and apply to licensed premises that supply alcohol between midnight and 6am, following a full council meeting yesterday.
The decision was announced less than a week after the authority’s licensing committee recommended introducing the fee.
The cost of the levy depends on the rateable value of each premises and ranges from £299 and £4,440 per year.
The council has estimated it could raise £100,000 in total each year for the police and council.
'Fair and reasonable'
Councillor Satvir Kaur, cabinet member for communities at Southampton City Council, said the current initiatives it has in place to “limit the effects the night time economy has on surrounding communities” come “at a cost to local taxpayers”.
“We have therefore decided to take the government’s advice to implement a late night levy on businesses authorised to supply alcohol after midnight,” she said.
“We believe it is fair and reasonable that companies benefitting from the night time economy should contribute to the costs it generates. This levy will mean that the council and its partners can maintain and hopefully increase the range of measures in place to manage the problems associated with the night time economy and continue to keep Southampton a safe and enjoyable place late at night.”
Association of Licensed Multiple Retailers chief executive Kate Nicholls said: “There is a danger that this levy may undermine support and funding for best-practice schemes, such as Best Bar None, already in place in Southampton, which the Council recognises already make the city a safe and enjoyable late-night destination."
She added: "We urge the council to work with businesses to ensure that the progress being made by retailers in Southampton is not diluted and to ensure that all revenues raised by the levy are put to use protecting and developing Southampton’s late-night economy.”
Earlier this month the Publican’s Morning Advertiser reported that respondents to the consultation on the levy criticised the council for presenting “flawed data” that was not specific to the levy period.
Almost two-thirds of respondents also said they did not support the introduction of a levy.