Frantic industry efforts to reverse the Treasury’s doubling of air passenger duty appeared doomed this week, leaving tour operators with an estimated bill of £44 million and airlines £100 million.
Federation of Tour Operators, the British Air Transport Association, and ABTA delegations emerged disappointed and angry from meetings with senior Treasury officials this week.
FTO director-general Andy Cooper said: “It’s a huge hit. The Treasury line is that it has factored in the impact on the industry and the policy will not change. But we cannot believe it has looked at this closely.”
Few believed the Government would withdraw the increase. But industry leaders desperately wanted a delay in imposition or, failing that, an agreement that the increase would not apply to those who have already paid to travel.
Cooper said: “It’s a double whammy because of the numbers involved and the Package Travel Regulations.” These mean tour operators must absorb any tax increase worth up to 2% of a booking.
“Everyone will suffer. There is a risk of operators having to review their business plans. It’s grossly unfair and of no benefit to the environment.”
BATA estimates 10 million people are booked to fly on its member airlines from February 1 and puts the uncollected tax at £100 million. Secretary-general Roger Wiltshire said: “There is no light down any tunnel. It’s an awful lot of money to find.”