The numbers for inbound United Kingdom tourism spending do not look good, and they make even worse reading for the country’s hotel and hospitality industries, according to the World Travel & Tourism Council and UKHospitality.
The WTTC, in collaboration with Oxford Economics, said it had calculated that the U.K. had "lost more than £2.2 billion ($2.94 billion) worth of exports as international visitors’ spending nosedived" in 2024, according to its "2025 Economic Impact Research" report released on April 23.
It said 2024 numbers were 5.3% lower than pre-pandemic totals.
The main reason for this, according to the WTTC, is a raft of additional costs to guests, diners and hoteliers.
Costs that are new or have increased include the start on April 2 of the Electronic Travel Authorization ETA, an arrivals charge for those who don't need a visa to enter the U.K.; the continued effects of the Jan. 1, 2021, abolition of value added tax-free shopping for international visitors; rises in air passenger duties; and increases in employer National Insurance Contributions, among others.
The WTTC also noted the 40% reduction in the budget of VisitBritain, the country’s principal marketing arm.
UKHospitality points to those NIC increases as one notable burden on hotel operations.
"Hospitality businesses will now face an additional £1.9 billion in wage costs, £1 billion of employer NICs and £500 million in business rates, as a result of relief being lowered from 75% to 40%," UKHospitality said.
Julia Simpson, the WTTC’s president and CEO, said in the report the extra costs are damaging to the U.K. brand. The government is risking stagnation and long-term decline in travel and tourism without targeted action and investment.
"Globally, travelers are spending more than ever before, while other countries are benefitting," she said. "The loss of regional support is particularly concerning. Without dedicated marketing and investment, regions outside London will struggle even more to attract international tourists, despite their huge untapped potential.”
At its call to action, the WTTC said in the report the world is travelling again and spending more than ever before.
"If the U.K. wants a share of the pie, it must stop sabotaging its own success. The U.K. has the brand, the appeal and the infrastructure. What it lacks is political will to allow travel and tourism to thrive.”
Infrastructure projects planned in the U.K. aim to boost inbound tourism.
In January, Rachel Reeves, the U.K.’s chancellor of the exchequer, said the government is supporting the construction of a third runway at London Heathrow, the U.K. and Europe’s busiest airport.
The same proposal has been tabled and then abandoned twice in the past 15 years, and analysts said even if it is built, it will not help boost international arrival numbers for some years to come.
On April 9, the U.K. government announced the signing of an entertainment resort and theme park from Universal Destinations & Experiences, part of Orlando-based Comcast NBCUniversal.
Due to open in 2031 in Bedford, 60 miles north of London, the park will “bring an estimated £50 billion boost for the economy and create around 28,000 jobs in total across creative, hospitality and construction industries,” the U.K. government said in a news release.
The news release added initial plans for the project include a 500-room hotel. Construction on the site is due to begin in 2026.
In 2022, the U.K. government looked at reinstating VAT-free shopping for international travelers, but it decided not to go ahead with its reintroduction.
A report from Oxford Economics in late 2022 stated the government “estimated that this scheme would cost the exchequer £1.3 billion in 2024-2025, increasing to £2 billion in 2025-2026.”
In late April, the city of Liverpool announced it will impose a £2 hotel tax, according to newspaper the Liverpool Echo.