UKHospitality Chair Kate Nicholls warns that a proposed “holiday tax” could inflict billions in economic damage, cost 33,000 jobs and undermine the UK’s tourism ambitions, as the industry ramps up pressure on MPs to oppose the levy.
The reaction to our Stop the Holiday Tax campaign has been remarkable.
As I write, a staggering 22,000 letters have been sent to MPs, while there have been more than 100,000 visits to our dedicated campaign page https://stoptheholidaytax.uk/
A big thank you, then, to everyone who’s written to their MP and clicked that link.
Support for the campaign has also come from opposition parties, with both the Conservatives and Reform saying they’re committed to opposing the tax.
Tory Shadow Chancellor Mel Stride and Reform’s Robert Jenrick have both made visits to member businesses – to Butlin’s in Bognor and a Haven Parks site in Lincolnshire respectively – to learn about the effects of the tax.
And what a devastating impact it would be for hotels and the wider sector, according to a recent Oxford Economics report commissioned by UKHospitality.
Its analysis reveals that the Government’s proposed holiday tax would shrink GDP, cause thousands of jobs losses and see the Treasury lose hundreds of millions in tax revenue, laying bare the shattering effect it would have on holidaymakers, businesses and the economy in England.
Assuming the impact of a 5% levy is fully realised by 2030, Oxford Economics predicts a reduction in GDP of £2.2bn, a £1.6bn tax increase for holidaymakers, £688m in reduced tax receipts to the Treasury, and a £101m loss in direct investment from hotels and other hospitality and tourism businesses.
The report goes on to forecast a £1.8bn reduction in tourism spending, 11.9m fewer nights spent in accommodation and 33,000 job losses.
All terrible outcomes, and which are completely at odds with the Government’s own ambition to increase inbound tourism to reach 50m international visitors by 2030.
Simon Vincent CBE, President, Europe, Middle East and Africa, Hilton puts it perfectly: “The Oxford Economics research is clear that a proposed holiday tax, on top of already high VAT, will impact British families staying in the UK and make the country less competitive as a destination.
“Tourism thrives when government and industry work together. The focus should be on growing visitor numbers and enabling hospitality to play its full role in supporting jobs, investment, and economic growth.”
It’s vital we keep up the pressure. Hoteliers, please encourage your guests to write to their MPs; and in case you haven’t already, we’d ask you to get writing to your own MP, too.
Because holidays are for relaxing, not taxing.
The full Oxford Economics report can be accessed here https://www.ukhospitality.org.uk/wp-content/uploads/2026/03/Oxford-Economics-holiday-tax-economic-modelling-report.pdf
Kate Nicholls
Chair
UKHospitality