The UK Treasury plans to raise the Air Passenger Duty (APD) starting in 2026, prompting Ryanair to announce cuts to its flights.
The budget airline intends to reduce flights to and from the UK by around 10% beginning next season, citing the UK government’s planned 13% tax increase on air travel as the main reason, according to DPA and The Financial Times.
Ryanair CEO Michael O’Leary sharply criticized the tax hike, arguing that it will hinder the UK’s economic growth and significantly increase flight costs. He stated that Ryanair would “reassess” its flight schedules, with planned cuts potentially reducing passenger numbers at UK airports by up to 5 million annually.
This week, Chancellor of the Exchequer Rachel Reeves unveiled a proposed budget for 2024, which includes tax increases primarily affecting wealthier individuals and corporations. As part of the proposal, the APD will also rise beginning in the fiscal year 2026/2027, with rates based on flight distance and travel class.
Following the tax increase, ticket prices for short-haul economy flights will see a rise of approximately £2 (€2.38), while private jet owners will face a 50% tax increase.
O’Leary expressed disappointment, pointing out that the UK government had pledged to encourage growth. Instead, he argues, this budget will hurt the economy, aviation sector, and tourism.
“This foolish decision by Chancellor Rachel Reeves to further increase an already steep APD will lead to cuts, not growth,” O’Leary said. He added that such short-sighted taxation will make holiday flights significantly more expensive for British travelers and diminish the UK’s competitiveness as a destination compared to countries like Ireland, Sweden, Hungary, and Italy, where governments are cutting or eliminating similar taxes to boost travel, tourism, and job creation.
