Confirmation this week that the government intends to make no changes on APD was another kick in the teeth for our industry and for destinations reliant on tourism.
The Treasury tells us that it is committed to growth and protecting jobs, yet it is pressing ahead with a tax that is both punitive and regressive.
Travel generates many billions of pounds and supports the employment of thousands here and overseas. A double inflation tax increase jeopardises our ability to compete in an international market.
At Virgin Holidays, we believe there is incontrovertible evidence that APD is having an impact on the travel market.
People are reporting the US is doing well, but I don’t think that is the case across the board as people cut back on second holidays. Orlando, being a family product, is holding up at the times of year people have to travel, but it’s still tough during the rest of the year.
The impact of APD and fuel surcharges on flights means a holiday for a family of four is around £1,000 more expensive now than it was last year.
But where you really see the impact is in the Caribbean, where tourism is a key pillar supporting the whole community. There is so much all-inclusive in the Caribbean that the cost of a holiday is already expensive and, for winter, a Caribbean trip has been seen as a second holiday.
The chorus of disapproval from holiday companies, such as ourselves, from airlines and tourist boards should have been an indication to the Chancellor of the damaging impact recent decisions on APD are likely to have.
It’s simple equation: fewer international visitors means less money entering what are already vulnerable economies.
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