Lack of investment in UK tourism, ministers warned

The UK’s travel and tourism industry risks losing its global position due to a lack of investment and high taxes, the World Travel & Tourism Council (WTTC) has said.

The global tourism body has issued a warning to the UK government, urging it to invest now or pay the price, as data shows that the UK could lose up to £60 billion in tourism business over the next 10 years.

The UK’s travel and tourism sector contributed £280bn to the UK economy in 2024 and supported more than 4.1 million jobs. Despite this, successive governments have shown little interest in the sector, WTTC said.

The organisation said the opportunity for growth is significant, with global travel and tourism expected to grow 3.7 percent annually over the next 10 years, compared to 2.4 percent for the wider global economy.

‘UK pricing travellers out of the country’

However, the UK looks set to have one of the lowest growth rates in overnight international arrivals over the next five years, behind other European tourism countries like Spain, Germany and Italy, according to a report by Oxford Economics, commissioned by WTTC.

The WTTC said the UK is pricing travellers out of the country and to other destinations due to factors like an increase in National Insurance, VAT rates higher than the European average, increases in Air Passenger Duty, and the introduction of an ETA, a visa waiver which could rise from £10 to £16 per visitor.

Additionally, the VisitBritain tourism promoter is underfunded when compared to its competitors around the world, which receive up to double the government investment.

Also, travellers are opting to visit other European destinations as they are attracted by tax-free shopping, which was removed in the UK in 2021.

Julia Simpson, WTTC president and CEO, said the UK “is at a critical juncture”.

“The government is looking for growth and its travel and tourism sector offers just that,” she added.

Simpson said the sector has been “been misunderstood and poorly treated by successive governments”. The government, she added, “cannot tax its way out of debt, it needs to invest to grow”.

“Tourism promotion in the UK is chronically underinvested and it is arrogant to think tourists will always come to the UK,” Simpson said.

“The new government has a unique opportunity to change the trajectory of travel and tourism in the UK. Despite the industry’s resilience, years of government inertia are taking their toll.

“We welcome the new government’s commitment to surpassing 50 million visitors by 2030, but this can only be achieved with the right policies in place.”

Fortunately for the UK, two major theme parks are planned – a £300 million Puy du Fou near Bicester in Oxfordshire, and a Universal Studios theme park south of Bedford.