NEWS


Industry figures describe Sunak’s Budget as both a ‘shambles’ and as offering a ‘lifeline’


Chancellor’s travel ‘blind spot’ leaves the industry ‘shut out’


Ian Taylor


Travel industry leaders gave a lukewarm reception to the Budget on Wednesday and aviation chiefs condemned the chancellor for failing to mention the sector. There was dismay at Rishi Sunak’s


failure to extend support to businesses without retail premises and at the limits to furlough despite confirmation the scheme will be extended to September. Abta chief executive


STORY TOP


Mark Tanzer said the chancellor’s “blind spot” meant tour operators, online travel companies and home- based workers “remain shut out”. Tanzer told Travel Weekly: “The


point that the broader travel sector may not have retail premises hasn’t been addressed. Companies have been stopped from trading and had no real revenue for 12 months.”


travelweekly.co.uk Advantage Travel Partnership


chief Julia Lo Bue-Said said “travel agents are in a state of financial limbo” because “how and when we will travel is still fuelled with uncertainty”. The Travel Network Group


chief executive Gary Lewis said the extension of furlough offered “much-needed breathing space” and grants for the self-employed were a “lifeline”, but he warned of “a long road ahead”. Abta chairman Alistair Rowland, chief executive of Blue Bay Travel, noted: “Furlough can’t be maximised


as the scale of amendments and cancellations continue and, while the self-employed support scheme was extended, there is nothing to fill the gap for agents who operate as limited companies. The new loan scheme will help businesses, but increases debt.” Aviation leaders were more


damning. Airport Operators Association chief executive Karen


Dee said furlough and airport business rates relief were “not nearly enough”, adding: “The Budget is blind to the impact of the near-complete shutdown of travel.” Heathrow chief executive John


Holland-Kaye criticised “the absence of any meaningful support”, while a senior aviation source described the Budget as “a shambles”, telling Travel Weekly: “The idea we’ll be back employing everyone by September is ludicrous.” Sunak confirmed furlough will


be extended to September, with employees receiving 80% of salaries. But businesses will have to contribute 10% from July and 20% from August. Support for the self-employed will


also continue to September, with a tapered grant targeted at those whose turnover has fallen 30% or more. It will be extended to 600,000 workers who previously missed out. A new recovery loan scheme will offer loans ranging from £25,000 to


£10 million to any business. Sunak extended business


rates relief to the end of June and announced relief of two-thirds for the nine months to April 2022. The 5% rate of VAT on travel


and hospitality will be extended to September 30 followed by a reduced 12.5% rate for six months. Income tax thresholds will be


frozen from next year until 2026, but corporation tax on business profits will rise from 19% to 25% from April 2023. However, small businesses with profits up to £50,000 will pay the lower rate. The government ignored industry


calls to suspend APD. Rates on economy flights of 2,000-plus miles were already due to rise by £2 to £82 from April and by £4 to £180 on premium. These will increase again from April 2022 to £84 in economy and £185 on premium. Short-haul rates remain frozen. There was no move to abolish the double APD charged on domestic return flights.


4 MARCH 2021 5


PICTURES: Simon Walker/HM Treasury; Amelia Sonsino


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