Rise in air tax a ‘hammer blow’ to UK tourism

By Linsey McNeill
Home » Rise in air tax a ‘hammer blow’ to UK tourism

UKinbound CEO Joss Croft has slammed the Chancellor Jeremy Hunt’s decision to stick with the planned rise in air passenger duty (APD) from April 2023.

While he welcomed the business rates support package, announced in the Autumn Statement today, he described the decision to increase APD as ‘a hammer blow to the recovery of inbound tourism’.

“Having such an uncompetitive tax regime for travel is not only damaging the UK economy but runs counter to the Government’s ambitions for Global Britain,” said Joss.

He also urged the Chancellor to expand the business rates relief scheme, which will provide £14bn of support to retailers over the next five years, to non-retail businesses, such as tour operators.

Advantage Chief Executive Julia Lo-Bue Said described the budget as ‘underwhelming and disappointing’, warning that the tax increases announced by the Chancellor will dampen consumer spending.

“Any measures, such as personal tax increases on working people will have a detrimental impact on consumer’s disposable income, which in turn will have a further direct impact on the travel industry, especially at a time when COVID hangover remains and businesses are struggling to recover,” she said.

“The business rates reform lacks detail, and the increases in the national living wage and energy costs will all have a direct impact to business costs at such a challenging time.”

AITO Executive Director Martyn Summers said he believed the Budget would ‘lead to a reduction in the public’s propensity to spend their money on holidays’.

“Halving the capital gains tax allowance and the increase in – and freezing of – many other tax allowance levels, some until after the next General Election, and up to even 2028, coupled with extreme inflation, will lead to a reduction in Middle England’s spending power and will not curb the demand for higher wages.

“No doubt the small print will bring other surprises to light,” he added. “Revenge travel post pandemic may counter this to some extent, time will tell.”

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