URGENT UPDATE: Ryanair’s CEO, Michael O’Leary, has issued a dire warning regarding potential flight reductions and fare increases in the UK. This follows news that Chancellor Rachel Reeves is expected to announce an increase in air passenger duty (APD) during the upcoming budget on November 26, 2023.
The APD, a tax levied on flights departing from UK airports, is projected to rise starting April 1, potentially adding up to £2 to short-haul economy tickets. O’Leary cautioned that if this tax is implemented, airlines like Ryanair might shift operations away from British regional airports to countries with more favorable tax conditions, such as Sweden and Italy.
A Treasury spokesperson stated: “Unlike other sectors, no VAT applies to plane tickets, and [APD] changes will add just £2 for a family of four flying economy to Spain.” However, O’Leary’s concerns highlight the broader implications of these tax changes for UK travelers.
In a recent announcement, Ryanair revealed a significant profit surge in the first half of its financial year, reporting a profit after tax of €2.5 billion (£2.2 billion), marking a 42% increase compared to the same period last year. Passenger numbers rose by 3%, with 119 million people flying with the airline. However, the average fare climbed by 13% to €58, and O’Leary warned that fares are unlikely to decrease in the near future.
O’Leary stated, “Short-haul European air fares… are going to modestly increase for the next four or five years,” suggesting that travelers should brace for ongoing fare increases through 2027 and 2028. This announcement adds a layer of concern for budget-conscious travelers already grappling with rising costs.
As discussions around the budget unfold, the future of affordable air travel in the UK hangs in the balance. Travelers are advised to stay updated on these developments, as any changes could significantly impact flight availability and pricing.
The implications of these potential fare hikes and flight cuts are likely to resonate deeply with travelers across the UK, making it essential to monitor the upcoming budget announcement closely.
