Taxes for air passengers have been increased in the budget, meaning tourists could have to shell out more money to travel by plane.
In her statement, Chancellor Rachel Reeves announced an increase in passenger air travel fares, increasing the tax by £2 per trip for short-haul economy flights.
Under new Labor rules, passengers on these flights will pay £17 in tax on short-haul flights abroad from 2026, rising by £4 in total, including increases inherited from the Conservatives.
Minor impact: Close range fights will cost an extra £2 from April 2026 under new rules
Currently, those traveling in economy class pay £13 for flights to Europe and North Africa or £7 for domestic flights.
The increase will not take effect until the 2026/2027 fiscal year.
Under previous Conservative plans, the tax would rise by £2 in April next year, with premium passengers paying up to £224 for long-haul flights.
The Government said the increase was to ensure tax revenue “remains sustainable”.
Mark Tanzer, chief executive of ABTA – The Travel Association, said: “While a £2 increase may not seem like much, it raises the UK air tax on economy flights to £15 per person per flight. UK travelers already pay more in air taxes than most other countries, and it’s one of a multitude of taxes and fees people often have to pay while on holiday.
‘The UK already charges the highest APD rate in Europe. The Office for Budget Responsibility notes that the APD is among the fastest growing taxes in the UK. The government must keep a close eye on the overall cost of travel to ensure hard-earned holidays remain within our reach.’
Ahead of the Budget, a rise dubbed the “holiday tax” was rumored, and there was a rush of flight bookings as Britons sought to avoid the incoming tax.
However, the real increase will be among those who fly on private planes.
Reeves said the tax on private jet passengers will increase by 50 percent.
This, Reeves said, is equivalent to £450 per passenger on a private jet to California, mocking former Prime Minister Rishi Sunak, who is expected to be offered a job in the United States.
The Government also announced it would consult on extending the higher fare to include more private jets.
For planes equipped to carry fewer than 19 passengers, passengers flying long distances can currently expect to pay £607.
No change was announced for business class flights, with passengers currently charged £14 for domestic flights and up to £202 for international flights.
These figures came into force in April, having increased from £13 and £202 respectively.
The tax increase comes as part of the Government’s attempt to fill what it says is a £22 billion “black hole” in the UK’s finances. Prime Minister Keir Starmer previously warned the budget would be “painful”.
This is the money podcast
