Labour panic as disastrous tax hikes to send tourists elsewhere ‘costing UK £60bn’

that the UK’s travel and tourism industry faces significant challenges, primarily due to high taxes and a lack of investment, which may deter potential visitors.

If left unaddressed, the UK could lose out on up to £60billion in economic output over the next decade, according to a recent report from the (WTTC).

The London-based organisation, which represents the global tourism sector, commissioned a report from Oxford Economics that highlights the UK’s concerning position in the global tourism market.

It predicts that the UK will experience one of among major global tourist destinations.

Between 2024 and 2029, the UK’s expected increase in annual arrivals is a modest 3%, a stark contrast to countries like Spain (4.9%), Italy (5.7%), Japan (7.4%), and Australia (9.1%).

Key factors impeding the UK’s competitiveness in tourism include:

• The rise in National Insurance contributions
• A higher VAT rate compared to many European nations
• Increased Air Passenger Duty
• The introduction of a £10 digital permit for international visitors without a visa
• The ongoing refusal to reinstate tax-free shopping for international visitors
• The WTTC also criticized VisitBritain, the national body responsible for promoting the UK as a tourist destination, for being “seriously underfunded” when compared to its international counterparts. Many other tourist boards, they argue, benefit from double the government investment that VisitBritain receives, further hampering the UK’s ability to attract global travellers.

In response to these concerns, , Minister for Creative Industries, Arts, and Tourism, will lead the first meeting of the newly formed Visitor Economy Advisory Council. The council is designed to bring together leaders from the tourism industry and government officials to help boost the sector’s growth. Among the attendees will be Julia Simpson, president of the WTTC, who served as an adviser to former Prime Minister Tony Blair.

Ms Simpson emphasised the urgency of the situation, stating: “The UK is at a critical juncture. The Government is looking for growth, and its travel and tourism sector offers just that.”

She pointed out that tourism is one of the UK’s largest industries, contributing £280 billion to the economy last year. Despite its significance, Ms Simpson argues that the sector has been misunderstood and neglected by successive governments, which have placed excessive tax burdens on it.

“The Government cannot tax its way out of debt,” she continued. “It needs to invest to grow. UK taxes are higher than many of its competitors, making the UK expensive to operate in and expensive to visit.” She warned that it is “arrogant to think tourists will always come to the UK” and that the government has a rare opportunity to change the trajectory of the nation’s tourism industry for the better.

In response, a Government spokesperson reiterated its commitment to supporting the tourism sector, saying, “We are committed to supporting the UK’s world-class tourism industry as we move forward with our Plan for Change to deliver a decade of national renewal.”

The spokesperson also mentioned the ambitious goal of attracting 50 million visitors to the UK annually by 2030 and highlighted the formation of the Visitor Economy Advisory Council as part of the effort to co-create a strategy for tourism growth, with input from industry leaders such as the WTTC.

While the government acknowledges the importance of tourism, industry figures argue that urgent action is needed to ensure the sector can thrive in the face of global competition. Without significant investment and tax reforms, they say the UK risks losing its position as a leading destination for international visitors, with .