London becoming ‘bolt on extra’ on European tours
Wednesday, 09 Jul, 2009
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Inbound European tour operators have added their weight behind industry demands to prevent hikes in Air Passenger Duty.
The European Tour Operators Association warned that London could lose its place as a main gateway to Europe if the government goes ahead with plans to increase APD.
ETOA believes moves by the Dutch and Belgian authorities to remove travel taxes to stimulate tourism will make those countries more attractive to overseas travellers.
With the UK standing outside the Schengen agreement on a common visa for travel to Europe, the country is looking increasingly like an optional add-on than a key element of a visit to Europe for many in-bound long-haul travellers, according to the organisation.
“What the Dutch have done is sensible and this will boost inbound tourism. They have realised that inbound market has a choice and this move will attract inbound traffic,” said executive director Tom Jenkins.
“London is losing its gateway status. Scheduled tours used to start and finish in London now more and more start and finish on the continent.
“It used to be the automatic entry point and it is now becoming a bolt on extra. London is seen as optional rather than central.
“This has been exacerbated by the decision to stay outside Schengen, by very high visa fees and by the hike in APD.
“This blanket charge punishes people for choosing to come here. Whatever this does for the treasury; it is a stinging tax on exports.”
APD will be charged on international departures from the UK on a new four-level scale related to the distance from London to the capital city of the destination country, under the planned changes.
The increases are due to be imposed from November with a further rise set for November 2010.
From November 1 the new APD starts at £11 on tickets to destinations within 2,000 miles of London, £45 on flights up to 4,000 miles, £50 on flights up to 6,000 miles and £55 on flights over 6,000 miles.
From November 2010, the charges are £12, £60, £75 and £85. All these sums are doubled on premium class tickets, including premium economy where it is available.
For visitors to the UK returning home to key long-haul countries including Australia, New Zealand, Malaysia and travellers to the Caribbean, the departure tax will be more than double the £40 charged at present.
UKinbound chief executive Mary Rance said the rises in APD would harm Britain’s appeal to visitors from key long-haul markets.
“Inbound tourism has the potential to help bring the UK out of recession,” she said.
“Overseas visitors spent £16.4 billion here in 2008 and with the current exchange rates and the potential to attract even more tourists, that figure could be higher in 2009.
“However, the move to increase APD, as well as the massive visa costs levied against overseas visitors, will weaken our international competitiveness and deter travellers from visiting the UK.”
APD will raise £2.46 billion in revenue for the Treasury, but this is without taking full account of a drop in demand for air travel as a result of the increased cost and the economic downturn which has hit long-haul premium class travel worse than leisure economy, says ETOA.
Nor does it allow for the losses that arise from cuts in routes and jobs by airlines operating at UK airports straining under other pressures from the economic downturn, or from outbound travellers hopping to other European hubs such as Amsterdam for long-haul flights.
APD was introduced in 1994 by then Chancellor Gordon Brown as a “green tax”.
But the travel industry complains that there has never been any coherent accounting of how the revenue generated has been used to offset the effects of carbon emissions.
“I want to know where the money will go. How many trees will the Chancellor be planting with £2.5 billion?” said IATA director general Giovanni Bisignani.
“Padding the UK budget at the expense of holidaymakers, business travellers or exporters is not sound environmental policy.
“Instead of inventing new taxes with convoluted calculation methods, governments must support investment in basic green technology research, assist air navigation service providers to straighten out routes and allow airlines to operate as fuel efficiently as possible.
“And when it comes to economic measures, let’s focus on a global emissions trading scheme.”
by Phil Davies
Phil Davies
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