Families face soaring holiday tax bill

Families face having to find up to £500 tax to fly to far flung destinations by 2016 if the Government presses ahead with plans for annual rises in Air Passenger Duty.

Britain’s leading airlines stepped up pressure on George Osborne to call a halt to the rises by calculating how high the tax could rise on current Treasury plans.

Official figures show that a target of increasing revenue from the duty by 46 per cent by 2016 would mean a family of four would face a £500 tax bill for a holiday to Australia and £440 to the Caribbean.

In 2005, a family of four travelling to any long-haul destination would have paid just £80.

The next round of APD rises, which come into force on April 1, will see a family of four having to pay £368 tax for a trip to Australia and £264 for a holiday in the United States.

Four major airlines – easyJet, Virgin Atlantic, Ryanair and British Airways – have buried their differences – to oppose the taxes, which sees passengers leaving UK airports paying more than their foreign counterparts.

According to the airlines, seven years of APD has seen passenger numbers fail to rise, with the CAA figures showing that there has been no increase in the number of people flying since 2011.

“Aviation wants to, and should be, playing a leading role in economic recovery – as it does in so many other countries,” the airlines said in a joint statement.

“But the UK imposes the highest aviation taxes in the world, and keeps on increasing them without any analysis whatever of their overall economic impact. We are exporting economic growth, and jobs, to competitor countries. How much longer must this madness go on?

“We call on the Chancellor to suspend the April 1 rises in APD, and those planned up to 2016, while the Treasury commissions an independent study of the economic effects of this job-destroying tax.”

Meanwhile the World Travel and Tourism Council said its research had shown that scrapping the duty altogether would create 91,000 jobs in Britain and contribute £4.2 billion to the economy in 12 months.

“Air Passenger Duty is a completely disproportionate tax on people’s holidays and is hitting business travel hard,” said David Scowsill, the organisation’s chairman.

“When the economy needs help, it is economically illogical to continue with a tax that costs the country some 91,000 jobs and as much as £4.2 billion.

"Travel & Tourism grew by 4.1% in the UK last year, but is forecast to slow to 1.3% in 2012. This slowdown is partly due to the impact of Air Passenger Duty, which is dampening demand.”

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