Britain’s tourism deficit continues to widen, with the country currently losing around £1.1bn per month as UK residents spend more on overseas trips, while inbound visitors spend less.
Despite a rise in the
number of inbound visits to the UK for a fourth straight year in 2014, Britain’s balance of tourism payments deficit is increasing, according to the latest figures from the Office of National Statistics.
The first three months of 2015 saw UK residents spend £6.8bn in overseas countries, while people visiting the UK spent £3.5bn. As such, the tourism deficit currently equates to £3.3bn per quarter – or £1.1bn a month – a marked increase on the £2.4bn gap from the same period for 2013. The figures also showed that visitors to the UK are spending slightly less per trip than they have in the past.
Overall, visitors to the UK typically spend more per trip than Brits travelling abroad, but there are far fewer of them. Around 73.9m overseas residents have visited the UK since the start of 2013, spending an average of £631. Over the same period, UK residents have spent £594 per overseas trip, but they have made 129m of them.
Although inbound visitor numbers continued to grow in the first quarter of 2015, the overall amount they spent fell by 10 per cent. Tourism bosses have long been campaigning for a reduction in VAT on accommodation and attractions, to place the UK in line with the rest of Europe and encourage additional spending.
The Nevin report, commissioned by the Cut Tourism VAT Campaign, found that a VAT reduction from 20 per cent to five per cent for tourism businesses would provide a £4bn (US$6.7bn, €5bn) boost to the UK economy, create 120,000 jobs and put the UK back on a level footing with European tourism rivals.
The newly-appointed tourism minister Tracey Crouch has previously spoken out in favour of a reduction in tourism VAT and her appointment has unsurprisingly been welcomed by the industry.
“We look forward to working closely with John (DCMS secretary of state John Whittingdale) and Tracey, especially in leading the delivery of recommendations to reduce tourism VAT,” said BHA chief executive Ufi Ibrahim.
“The time has come for the hospitality industry to be empowered to help our economy reach its potential with more jobs, visitors and tourists across the UK.”
