Holiday tax bill rises to over £2.4 billion

August 13, 2016 12:01 AM

  • As families jet off on their summer holiday, new research shows how the treasury now takes in over £2.4 billion from holiday taxes
  • The average holidaymaker will be hit with a £61.12 tax bill as the taxman chases Brits all the way to the departure gate
  • The bill has increased by more than £900 million since the TPA first uncovered the figures in 2008

New research from the TaxPayers' Alliance (TPA) today shows how hard millions of holidaymakers are hit in order to enjoy a well earned break. The TPA has collated the cost of VAT on "pre-holiday shopping" - essential items such as sun cream, sunglasses and swimming shorts - and examined the cost of Insurance Premium Tax and Air Passenger Duty.

Thanks to the some of highest taxes on flights in the developed world, the tax burden on holidays abroad now stands at over £2.4 billion - that's nearly £62 for the average holidaymaker in Britain. 

A family of four travelling to Spain (with two kids under 16) from the UK this summer will face an average bill of £131.20 on their flights and holiday purchases. And a similar family of four travelling to Florida from the UK will be hit with a staggering £253.20 tax bill.

The TPA has consistently called for an end to Air Passenger Duty. Even though it is often touted as an environmental tax, it was never introduced for that purpose. Furthermore, it is duplicated by a number of other policy interventions.

The Scottish Government intends to reduce the burden of APD in Scotland by 50% between 2018 and 2021 as they know it will boost tourism, investment and business activity, as well as being a welcome relief for hard-working families who want a week in the sun. That move is creating tensions with airports in the North of England, who may lose out as a result of lower taxes in Scotland.

It would be easier to scrap the tax and give Brits a break. So today the TPA is renewing its call on the government to go even further and abolish APD altogether. 

Click here to read the full research note

Jonathan Isaby, Chief Executive of the TaxPayers' Alliance, said:

"Families across the UK work hard and save every year so they can enjoy a week away in the sun. So hard-pressed taxpayers have every right to be angry that the taxman chases them all the way to the departure gate to squeeze that little bit extra from their budgets.

"Not only is APD too high, it hits those on the lowest incomes the hardest making it more difficult for hard-working people to get a well deserved break. Politicians in Holyrood and Stormont understand the benefits of scrapping APD and it is about time that the politicians in Westminster did too, so that a holiday doesn't end up as the reserve of the richest families.

Tim Alderslade, Chief Executive of the British Air Transport Association (BATA), the trade body for UK airlines, said:

"APD is a departure tax on the hard pressed British traveller. It is the highest levy of its kind in Europe - by a long way - and the Treasury should be upfront about why it is prepared to see families in this country pay substantially more to take a well earned break than their counterparts in places like France or Germany.

"Flight taxes of this kind - in the post-Brexit world - should be seen as an anomaly and the Government should follow the lead of the Scottish Government and announce a major reduction sooner rather than later.

TPA spokesmen are available for live and pre-recorded broadcast interviews via 07795 084 113 (no texts)

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