By Okorie Uguru
The World Travel and Tourism Council (WTTC) has issued a warning to the United Kingdom (UK) Government that its successful travel and tourism industry faces stagnation and long-term decline.
This warning came on the eve of the UK government’s first Visitor Economy Advisory Council, the global tourism body revealed data that shows £60 billion is at risk over the next 10 years, in lost tourism business.
While forecasts indicate short-term stability, the long-term outlook is weak as the UK loses ground to European countries.
The UK’s travel and tourism sector directly employs almost the same number of people as the National health Service (NHS). It contributed £280 billion to the UK economy in 2024 (10.3 per cent) and supported over 4.1 million jobs (11.3 per cent). It also contributes £100 billion annually to the treasury in tax revenues, yet successive governments have shown little interest in travel and tourism.
The opportunity for growth is considerable. Global Travel & Tourism is expected to grow 3.7 per cent annually over the next 10 years, compared to 2.4 per cent for the wider global economy.
However, in the UK, the future looks troubling. Over the next five years, the UK is expected to have one of the lowest growth rates in overnight international arrivals. It is set to lag behind other European tourism powerhouses, such as Spain, Germany, and Italy, which place travel and tourism at the heart of government decision-making.
WTTC identified key areas that urgently require government action to unlock the sector’s full potential:
UK travel and tourism businesses are already impacted by the recent increase in National Insurance, and higher than European average VAT rates. With the increases in Air Passenger Duty (APD) and the introduction of an ETA, a visa waiver which could rise from £10 to £16 per visitor, the UK is pricing travellers out of the UK, toward other destinations
As the organization charged with promoting tourism in the UK, Visit Britain is seriously under-funded when compared to its competitors around the world, which in many cases receive double the government investment. Additional investment is crucial to continue attracting visitors, and ensure the economic benefits extend beyond London. Global travellers are choosing other European destinations, attracted by the tax-free shopping removed in 2021, which could generate an estimated £3 billion to UK Plc.
Julia Simpson, WTTC President and CEO said “The UK is at a critical juncture. The government is looking for growth and its Travel & Tourism sector offers just that. As one of the country’s largest employers alongside the NHS, contributing £280 billion to the UK economy last year, the sector has been misunderstood and poorly treated by successive governments.
“The government cannot tax its way out of debt, it needs to invest to grow. UK taxes are higher than many of its competitors – VAT, no tax-free shopping, employers National Insurance, APD, and now a potential new hotel tax, making the UK expensive to operate in and expensive to visit.”