Flights are set to become more expensive as the Budget confirmed that Air Passenger Duty is set to rise in line with retail price inflation (RPI).
Domestic and long-haul passengers are set to lose out the most in 2024-25.
The Budget report said: “APD rates will increase in line with RPI for 2024-25 rounded to the nearest pound, meaning that short-haul international rates remain frozen, benefitting more than 70% of passengers.
“Following a 50% cut in APD for domestic flights in 2023-24, the rate for domestic flights will increase by 50p to £7.
“The long-haul and ultra-long haul economy rates will increase by £1.”
The rates of APD from April 1 start at £6.50 for economy domestic flights, £13 in Band A for flights up to 2,000 miles, £87 in Band B for flights between 2,001 miles and 5,500 miles and £91 in Band C covering flights of more than 5,500 miles.
That represents 0.4% of all receipts and is equivalent to around £120 per household and 0.1% of national income.
The Office for Budget Responsibility estimates that APD will have raised £3.5 billion in 2022-23.
The OBR said: “Despite the higher rates charged for travel in classes above the lowest one available, the majority of receipts are generated from those travelling in the lowest class.
“This reflects the fact that over 90% of flights taken each year involve travel in a class that is liable to the reduced rate.”
Abta chief executive Mark Tanzer voiced “disappointment” at the government pressing ahead with inflationary rises in APD as announced in the government’s Autumn Statement.
“Not only is this bad news for travellers, as they have to bear the cost of this rise through their air ticket, but also UK competitiveness,” Tanzer said.
“The UK already has amongst the highest APD in the world and increasing this further contradicts with the message that we want to grow the economy.”