Blow to Tourists' Pockets: Popular Country Raises Flight Tax, Advances Tax on Accommodation

A vacation in the UK could become more expensive in two key areas: flights and accommodation. The budget documents published by the government yesterday, October 28, include two separate measures, a further increase in the air passenger tax, and the promotion of legislation that would allow regional authorities in England to impose a levy on overnight stays by visitors.

For the tourist, the two decisions may come together in the same vacation bill: a tax paid as part of the airfare upon departure from the UK, and a possible addition to the price of accommodation, depending on the decisions made at the destination.

Flight Tax: Additional Increase from April 2028

The government has announced that from April 1, 2028, all Air Passenger Duty rates will increase in line with the UK Retail Price Index (RPI). This is a further update, iT addition to the rates already published for April 2027.

The tax rate varies by destination and class of travel. It applies to flights departing from the UK, subject to rules and exemptions, and is not an entry tax into the country. Raising it increases the tax component of the ticket; the final price per passenger also depends on the airline's pricing.⁠

Accommodation Tax: Government Advances Authority, Authorities Will Decide

At the same time, the budget confirms the intention to advance legislation that will give strategic regional authorities in England the authority to introduce an Overnight Visitor Levy, a levy on overnight stays by visitors.

According to the government's outline published in September, the levy is to be collected as a percentage of the cost of accommodation, rather than as a fixed amount per night. The government presents it as a tool to finance local infrastructure, transportation and events that support tourism.

However, this tax has not yet come into effect across England. The legislation and decisions of the relevant authorities are still required. Therefore, even for London, it is too early to determine how much the tourist will pay and when.

The current development is progress on the government's track: another increase in the flight tax alongside expanding the possibility of taxing accommodation, two steps that may later burden the travel budget.