Published on Thursday, April 19, 2012
High air taxes are putting people off coming the London Olympics, business leaders told the culture secretary Jeremy Hunt precisely 100 days before the Games start.
Tour operators have seen a 50% drop in inbound bookings for the third quarter of the year which covers the Olympics, according to UKinbound chief executive Mary Rance, who described the figures as "disappointing".
She said bookings from April to June, including during the Queen's Jubilee celebrations, were down 25%.
"It is clear that Air Passenger Duty is a major contributing factor deterring the regular visitors from coming to the UK, both before, and during the time of the Olympics," she said.
In a letter published today, industry leaders say arrivals from Australia will be 25% down and there will be 26% fewer people from New Zealand coming to London during the event.
Although overall flight arrivals are up 31% for July and August, they said other European cities are seeing similar increases. They say this shows people are avoiding flying into the UK.
In the letter to Hunt they said it was "inconceivable" that this year's 8% rise in APD won't deter visitors.
Anne Godfrey, chief executive of the Guild of Travel Management Companies said: "The tax avoidance measures that passengers are taking to get around paying APD are hardly surprising.
"It’s likely that more and more passengers will explore ways of circumventing the tax, particularly following the increase in APD by a further 8% last month, at the same time as many European countries are cutting their air passenger taxes or abolishing them altogether."
Simon Buck, chief executive of the British Air Transport Association said a family of four could save £200 by flying to the US from an airport outside the UK." said: "By continuing to ratchet up the tax on flying from UK airports, the Government will only drive even more passengers to cheat the taxman and fly to their destination on separate tickets via continental hub airports such as Amsterdam, instead of directly from the UK," said Buck.
"That isn’t good for UK business, the travelling public, jobs, the economy or even in the long run, the Treasury."
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The recent insolvency of Low Cost Travel Group, one of the large players in the travel industry had a big impact on the travelers, hotels and all related players from both wholesale & retail arms. There were about 27,000 people on a holiday who had booked through the company comprised of a €200 million wholesale arm and €500 million OTA / retail arm.