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Holiday Tax Backlash Grows as New Poll Warns Britons Could Cut UK Breaks

ended 14. May 2026

A proposed UK holiday tax is coming under increasing political and public pressure following new polling suggesting it could reduce domestic tourism, cost jobs and damage coastal economies.

The research, commissioned by UKHospitality, found that 56% of Britons oppose the proposed levy, while nearly three quarters said it would reduce or stop UK holidays altogether. Modelling also suggested the tax could cost 33,000 jobs and leave the Treasury worse off financially by 2030.

The debate is becoming increasingly politically sensitive, particularly in coastal and tourism-dependent communities where hospitality businesses remain a major source of employment and local economic activity.

  • Would a holiday tax discourage you from booking UK staycations?
  • Are domestic holidays already becoming too expensive for families?
  • Would a tourism levy damage or strengthen coastal communities?
  • Could the UK hospitality industry absorb another financial pressure?
  • Is the Government underestimating the importance of tourism to local economies?

6 responses from the Newspage community

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Kate Allen
Owner at Finest Stays
From our perspective in the hospitality industry, domestic tourism remains incredibly price-sensitive. Families are already carefully weighing up the cost of UK holidays against travelling abroad, and even relatively small additional charges can influence behaviour far more than policymakers sometimes realise. Coastal economies like Salcombe rely heavily on hospitality, tourism and small independent businesses, many of which are still operating on tight margins despite strong demand returning post-pandemic.

The concern is not simply the tax itself, but the cumulative effect of rising costs on guest confidence and booking behaviour. Tourism businesses want to continue investing, employing local people and extending the season, but policies perceived as making UK holidays even more expensive risk having unintended consequences for the very communities they are trying to support.
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Riz Malik
Independent Financial Adviser at R3 Wealth
I can go to my local airport and fly to a number of European destinations cheaper than a return to Birmingham on the train. Why give people even more reason to look further afield no matter how much they want to support the UK economy.
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Nouran Moustafa
Practice Principal & IFA at Roxton Wealth
I think a holiday tax is a dangerous idea dressed up as local funding. Families are already asking whether a UK break is affordable once you add accommodation, food, travel and activities. If you make domestic holidays more expensive, many people will not magically pay it; they will shorten the trip, spend less locally or go abroad.
That is where the policy becomes self-defeating. Coastal communities do not just rely on hotel bookings. They rely on cafés, restaurants, taxis, attractions, seasonal workers and small businesses all benefiting from visitors. If the modelling is even close, with a 5% levy potentially reducing tourism spending by £1.8bn and putting 33,000 jobs at risk, this is not a small add-on; it is a direct hit to local economies.
The Government risks underestimating how emotionally and financially stretched families are. A staycation used to be the affordable option. If we tax that too, we should not act surprised when people stop booking.
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Harry Goodliffe
Director at HTG Mortgages
What a crazy time to hit UK holidaymakers with yet another tax. When so many families already struggle to afford a UK break as it is. Staycations aren’t exactly cheap anymore, and adding extra costs will just push more people to stay home or look abroad instead. Coastal towns and tourism businesses depend on those visitors, so this feels like a policy that could destroy local economies far more than it helps.
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Paul Denley
CEO at Oakham Wealth Management
A modest, locally controlled tourism levy is understandable in principle. Coastal communities face real seasonal pressures on infrastructure and services, yet often lack the funding to maintain them. If genuinely ringfenced and reinvested locally to improve transport, public spaces and support for small businesses, there is at least a coherent argument for it.

The problem is trust. Hospitality businesses fear taxes introduced in the name of local support may simply become another revenue stream for a wider funding system already under strain. Stronger growth and thriving local economies generate a stronger tax base than incremental levies ever will. The sector already faces VAT rates roughly double those of competitors like Spain and France, alongside rising wages, energy costs and business rates.

Families are already questioning whether UK staycations remain affordable. Policymakers should be encouraging domestic tourism, not risking policies that make it steadily less attractive.
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Colette Mason
AI Ethics Consultant at Clever Clogs AI
Taxing people for staying overnight in their own country while the sector already pays double the VAT of its European competitors is a confession that local government funding is broken and someone else has to pay for it. The chancellor's cupboard is bare despite eye-watering national tax rises.

The holiday tax is being handed to regional mayors as a power, but it's actually being handed to them as a toxic problem. Impose it and they eradicate thousands of jobs and chop another £2bn off GDP. Don't impose it and their roads, transport and public spaces stay unfunded.

In the past few years, UK staycations have leapt up in price with a lack of low-cost hotel beds, increased business rates, energy bills and wages. Going abroad is often a like-for-like swap. Does Labour enjoy squeezing every shred of joy out of life? It feels like it.

Why is an extra funding tool being offered to local infrastructure one that punishes the sector already keeping those communities alive?