UK tourism under fire for failure to compete

The UK tourist industry has come under fire in two separate reports this week which warn that value-added tax and the cost of local

holidays are severely hampering the market.

The Mintel report, Holidays, says the UK long-break market “appears to have entered into terminal decline”, unable to compete with cheap overseas holidays.

The report shows that the number of UK holidays has fallen by one per cent since 1990 to about 57.7 million this year. In the same period, their value has risen by 25 per cent to 9bn.

“This illustrates the expense of UK holidays and is a key factor behind the sector’s demise,” says a Mintel spokesman.

At the same time the British Tourist Authority is urging the Government to cut VAT on tourist services. In a separate report by Touche Ross, the BTA says a reduction in VAT to eight per cent would, within four years, bring in an extra 10 million tourists and a 4bn increase in related expenditure.

The Government levies the second-highest rate of VAT on tourism in Europe, after Denmark, which charges 25 per cent. The BTA says this is contributing to the UK’s declining share of international tourism.