Inbound travel association UKinbound has said government support for the sector “falls short” and warned of business failures and thousands of job losses without additional aid.

UKinbound reported the results of its latest Business Barometer of members today, warning “a significant number of companies are in a critical state” and confidence levels at “a near-record low”.

The association warned in July that inbound tour operators and destination management companies (DMCs) would cut 10,000 jobs and more than half could fail within six months without government support.

The barometer found one in 10 UKinbound members don’t expect to bring anyone back from furlough despite the Job Retention Bonus, which almost two-thirds of businesses hope to be eligible for.

Half (52%) of the businesses said the current VAT reduction would not benefit them, with just one in five saying it would have a positive impact.

UKinbound called for immediate support including an extension of the Coronavirus Job Retention Scheme, or furlough, through to March 2021. The scheme is due to finish at the end of October.

It also called for a Tourism Resilience Fund “to help businesses wholly reliant on international visitors to survive until spring 2021”

The association urged an amendment to guidance on rate relief and grants to include tour operators and DMCs, and it called for national insurance and corporation tax holidays for businesses until the market recovers.

UKinbound chief executive Joss Croft said: “Many inbound tourism businesses are in critical need of support and the government’s ‘one size fits all approach’ leaves many in the cold.

“Our members are hopeful the international market will return from spring 2021, but this leaves a gaping hole in business finances until then and, although the VAT cut and Job Retention Bonus are welcome, they will not help previously profitable businesses stay afloat.

“We implore government to act swiftly with measures that will positively impact businesses and save jobs.”