Travel groups warn about impact of future APD rises

The government is planning to increase the rates of APD in line with the RPI (retail prices index) rate of inflation from the 2024-25 financial year.

Mark Tanzer, Abta’s chief executive, said: “While the delayed increase does provide a window for businesses to continue to build on their recovery, it will add extra cost to business trips and holidays in future.”

Meanwhile Joss Croft, chief executive of UKinbound, added the decision to raise APD rates would be a “hammer blow to the recovery of inbound tourism”, as it increased the UK’s “competitive disadvantage” with other destinations. 

“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 Croft.

Travel groups did welcome some elements of this week’s Autumn Statement, including providing £14 billion in business rates relief. Read our analysis of the impact of the government’s latest policies on the travel industry.

“We greatly welcome the business rates support package, which will come as a welcome relief to many businesses in the inbound tourism sector,” added UKinbound’s Croft.

“However, we urge the chancellor to go further and expand the business rates relief scheme to include vital non-retail businesses such as tour operators, who were also excluded from the leisure and hospitality pandemic support.”