Tourists will be ‘double taxed’ under Labour plans, says Ryanair boss

Ryanair has said holidaymakers will be “double taxed” under Labour’s plans to introduce a tourist levy as they already pay air passenger duty (APD).

The Government previously announced proposals to give regional leaders across large parts of England the power to introduce levies on overnight stays to help raise funds for their areas.

It is understood the levy would have no upper limit, though Government sources said mayors were unlikely to make it too costly, with most indicating it would be a few percent.

Speaking at a press conference in London on Wednesday, Ryanair’s chief executive Michael O’Leary said he was not opposed to the plans but argued it would mean tourists were “double taxed” as they already paid APD.

Mr O’Leary said that if the plans went ahead, the airline would look at switching some operations to “zero-tax, lower-cost destinations elsewhere in Europe”.

He said: “We call on (the Prime Minister) Mr Burnham if he’s really serious about delivering growth in every postcode – the only way to do that is to boost aviation and tourism, which can be turned on or turned off instantaneously and can deliver growth in every region, in every airport, in every region.”

He said: “We don’t have any great fundamental philosophical difference with his regional tax, where you allow the regional mayors to add a tax on hotel nights, but that is a double tax on tourism.

“Abolish APD. You can’t tax tourists on the way into the UK and then double tax them for the hotel night.”

Hospitality chiefs have previously warned they believe the uncapped proposals for the new tax could cost the UK hospitality and tourism industry up to £1.6 billion.

Meanwhile, APD rates, which are based on the length of the flight and the class of cabin, increased in April.

Passengers travelling in economy are currently charged £8 for a domestic flight and £15 for a short-haul flight, up to 2,000 miles.

Airlines have long called for APD – which is imposed on flights from most UK airports – to be reduced or cut, claiming this would lead to an increase in demand for travel.

A Government spokesperson said: “Mayors and local leaders have been given this new power as part of a historic devolution drive that shifts power out of Westminster and into local hands.

“Every other G7 country already has some form of visitor levy, and all funds raised will be invested in the local economy, from high streets to public transport and events that boost tourism and drive good growth – benefitting visitors, businesses and local people.”