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From The Telegraph:
Rocco Forte said increasing Air Passenger Duty by £1 per flight could recoup a significant proportion of what is now raised by VAT on hotel rooms, cutting costs for British holidaymakers and encouraging foreign travellers to stay longer once in Britain.
“Visitor numbers to Britain have fallen from 33 million to 29.5 million since 2007,” Mr Forte said, in an interview with Telegraph Travel. “That represents around £2 billion in lost revenue each year, going by Visit Britain’s own statistics, or roughly equivalent to what VAT on hotel rooms raises.
“I understand that the Government needs to raise tax, but VAT on hotel rooms has nothing to do with consumption as the rooms are there whether occupied or not – it’s just a tax grab. A more sensible way of raising money would be increasing APD by £1. There are far more plane seats than hotel beds, and it would raise money, too. No one will notice £1 on top of their plane ticket, but £12 or more on top of the cost of a hotel room is putting off domestic and business travellers.”
APD is also imposed by authorities in the United States, but is resisted by airlines here. “Any additional taxes on flying are unnecessary and ill-timed,” said Michael O’Leary, who manages Ryan Air in Europe.