As Britain sees a smattering of sunshine this morning, I'm sure many will start to think of planning holidays this summer; the foreign cuisine they will eat, the sights they yearn to see and now the taxes they will have to pay. As of this month there has been an 8% increase in Air Passenger Duty (APD) and this has been met with chagrin from businesses, families and the average cash-strapped Brit. The rate of 8% far surpasses the rate of inflation, meaning that gap year dreams and family holidays will cost exponentially more.
Family holidays further afield will bear the brunt of these exorbitant charges with a family holiday to the USA or Australia eliciting APD charges of £260-£368 respectively. Flying to either of these two destinations also equals a grand total of eight charges and taxes. EasyJet and Ryanair, amongst other travel airlines, have joined forces against this unfair charge (oh the irony) arguing against gloomy ramifications for jobs and the economy.
According to the Office of Budget Responsibility (OBR) the government can hope to accrue £2.8 billion from this tax in 2012/2013, but travel companies and incoming tourism will take a dip, especially during the Olympics. Tourists to our fair island will also be forced to pay extortionate tube prices of up to £8.40/$13.43/€10.07 per day for unlimited tube travel. This in addition to the 'pasty tax,' Congestion Charge and other egregious charges imposed on Londoners and tourists will continue to proliferate London's image as one of the most expensive cities in the world. Now we can't even go abroad without facing heavy charges.
In a time of austerity, where bankers' bonuses and MP's expenses are being scrutinised and disparaged, this unreasonable "tax on tourism" is exploitative and does not bode well for the future of the travel industry. The Holiday Money Report illustrates that cheap fares and transparent costs will be integral in getting us abroad, evidenced by the increasing popularity of budget package holidays.
Britain already pays the highest amount of aviation duty in Europe. The Treasury attempted to justify the tax arguing that "unlike some other European countries, the UK does not levy VAT on domestic flights and aviation fuel is not taxed." Even so, I'd be willing to hazard a guess that the majority of British holiday-makers will not be flying from Edinburgh to Skegness (or anywhere else in the UK). The Telegraph estimates that British travellers face taxes up to 30 times higher than those paid by the rest of Europe and Craig Richmond, chief executive of Peel Airports, wryly notes that "our European competitors will undoubtedly be celebrating this news."
Embarking on a gap year in 2012/2013 means I and countless other itchy-footed Brits will have to deal with increased APD on flights, opaque booking costs and 'administration' fees (EasyJet, Ryanair, I'm looking at you). Despite what Madonna said in the '80s, this year, holidays will not be a time to celebrate.