'Holiday tax': families paying hundreds of pounds in hidden fees


Updated on 15 August 2016 | 5 Comments

From airline tickets to travel insurance, we're taxed on almost every element of our holiday.

A new report reveals that a family of four could pay as much as £253 in ‘holiday tax’ before they even board a plane.

The TaxPayers’ Alliance (TPA) study outlines how we're taxed on everything from airline tickets to travel insurance – and even that new holiday wardrobe.

Figures show that taxes make up a significant proportion of the cost of holidays, with the relative cost of ticket taxes in the UK being the highest in the developed world.

The overall 2016 tax bill for holidays abroad will be more than £2.4 billion, the TPA claimed.

That’s an increase of more than £900 million since 2008 as a result of rises in VAT, Air Passenger Duty and Insurance Premium Tax.

This means that the average UK holidaymaker will pay £61.12 in holiday taxes, with a family of four holidaying in Spain paying £133.20 and the same family of four holidaying in Florida paying £253.20 in holiday taxes.

Numbers are based on the ONS Travel Trends 2015 report.

Item

Tax charged (£)

Number of travellers

Tax per person (£)

Total APD charged on holiday flights

511,636,107

32,761,417

15.62

VAT on pre-holiday shopping

1,844,263,409

42,150,0001

43.75

Holiday Insurance Premium Tax

73,762,500

42,150,000

1.75

Total holiday taxes

2,429,662,016

117,061,417

61.12

The report comes shortly after an announcement from the Scottish Government promising to reduce Air Passenger Duty between 2018 and 2021.

Pre-holiday shopping

A large amount of tax is from the shopping we do before departure, according to the report.

The TaxPayers’ Alliance figures are based on a basket of goods likely to be purchased before departure, with things like toothpaste, sunglasses and a swimsuit.  

Item

Adults

Children

 

Price (£)

VAT (£)

Price (£)

VAT (£)

Sun cream

8.00

1.60

8.00

1.60

Sunglasses

20.00

4.00

0.00

0.00

Summer dress

30.00

6.00

0.00

0.00

Sarong

10.00

2.00

0.00

0.00

Razors

10.50

2.10

0.00

0.00

Shaving foam

3.50

0.70

0.00

0.00

Toothpaste

2.50

0.50

1.25

0.25

Aftershave/perfume

40.00

8.00

0.00

0.00

Haircut

24.00

4.80

12.00

2.40

Deodorant

2.75

0.55

0.00

0.00

Session on a sun bed

7.00

1.40

0.00

0.00

Pairs of shorts

20.00

4.00

8.00

0.00

2 t-shirts

24.00

4.80

10.00

0.00

Swimming costume

15.00

3.00

8.00

0.00

Pair of flip flops

12.00

2.40

5.00

0.00

Per person (£)

45.85

45.85

52.25

4.25

Number of holiday makers

40,027,065

1,835,240,936

2,122,935

9,022,473

Total VAT bill

 

 

 

1,844,263,409

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Is this what your pre-holiday basket looks like? Let us know in the comments below 

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