“Qualified welcome†to Tory stance on travel industry
Saturday, 15 Mar, 2010
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ABTA has given a only a qualified welcome to the Conservative’s stance on the travel industry.
The association backed shadow chancellor George Osborne’s promised support for domestic tourism but was disappointed at a lack of concrete proposals for the outbound travel sector.
ABTA chief executive Mark Tanzer said: “These supportive comments from the shadow chancellor for domestic tourism are very welcome.
“Domestic and inbound tourism is the backbone of the UK tourism sector but we would also like to see how the Conservatives will approach outbound tourism.
“Outbound tourism is not a marginal policy area. Last year over 60 million trips abroad were made by Britons meaning this is an area that warrants serious policy consideration.”
Tanzer added: “We would like to see concrete proposals backing up the five point plan raised in ABTA’s Travel Manifesto to help ensure a successful future for all of the tourism industry, the 5th largest in the UK providing jobs for 2.7 million people.
“It is good to see the Conservatives taking issues like reform of Furnished Holiday Lettings seriously too.
“Issues like FHL won’t feature highly in political party broadcasts in the coming election but are critical to our sector’s financial health.
“Recognising the failings in the current proposals is a good step forward. ABTA is calling on the government to take similar steps in the upcoming Budget.”
Thomas Cook director of government and external affairs and ABTA board member Andy Cooper who represented ABTA as Osborne gave his speech in Blackpool, said: “George Osborne’s speech was an important indication that tourism will be a priority for any future Conservative government.
“Although outbound issues were not emphasised as strongly as domestic we are pleased that he left the door open for further reconsideration of how Air Passenger Duty works.”
Osborne said that the Conservative’s agenda for tourism and culture would be put to the country in less than two months time.
“We want to increase the proportion of UK residents’ tourism spend that goes on domestic holidays from 38% to 50%,” he said.
This would mean a £6.5 billion boost to the UK economy and thousands of new jobs across the country.
He added: “We will cut the headline rate of corporation tax from 28p to 25p by abolishing complex allowances and reliefs, and we are aiming to create the most competitive tax environment of any major economy.
“And to help small business – and I know that 80% of tourism businesses are SMEs – we will lower the small companies’ rate to 20p, once again by reducing complex reliefs.
“What’s more, we will make small business rate relief automatic to reduce admin costs and encourage take up.”
Addressing the issue of Labour plans to abolish tax relief on Furnished Holiday Lets this April, Osborne said it was “obvious that this tax raid will hit the tourism industry hard”.
He said: “In total 120,000 businesses will be affected – and according to the Tourism Alliance, 4,500 jobs could be lost.
“In total, the net cost to the UK economy could be as much as £200 million.
“And of course, the repeal of this tax relief will reduce the attractiveness of the self-catering sector for new entrants and make it more difficult for owners to invest in the upkeep of their properties.
“I’ve heard all the arguments – and I’ve got to say that I agree with them.
“So I can today announce that a Conservative government will take action to undo the damage caused by the abolition the Furnished Holiday Lets reliefs.
“We will do this is a way that is fiscally neutral, and consistent with our commitment to cutting the deficit and restoring the public finances to health.
“My team is working with tax and legal experts to explore how this should best be achieved, including proposals to change the eligibility thresholds and amending the interest deductibility criteria.
“Unlike the current Government, we will take action to support British tourism.
“Reversing the damage caused by the abolition of Furnished Holiday Lets relief is yet more evidence of our commitment to this cause.”
He also revealed plans to overhaul the planning system to strip away red tape and give communities real incentives to approve proposed new developments.
“Last but not least, getting the infrastructure right also means putting in place a framework that makes the most of the massive opportunity to promote British tourism alongside the Olympics in 2012,” said Osborne.
“Our aim must be to seize this once in a generation chance to inspire people across the world to visit not just London, but the whole of the country.
“So a Conservative government will aim to establish a fund to market London and British tourism around the world.
“This marketing should take place before, during and immediately after 2012.”
by Phil Davies
Phil Davies
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