What a Labour government might mean for your holidays – from tourist taxes to Airbnb clampdowns

Think July 4 is just another day in the sprint towards your summer holiday? Think again. The General Election could impact how we travel, particularly if Labour win – as all the polls currently predict.

Here are eight ways that a Labour government could affect your holidays.

More tourist taxes on the horizon?

The Welsh government, currently a Labour minority administration under the leadership of First Minister Vaughan Gething, has been working to give local councils the power to charge an additional fee for overnight stays. The tax, it says, will generate revenue to pump straight back into the tourism industry.

However, some restaurant and hotel owners have argued that after the struggles of Brexit and Covid, plus the ongoing cost of living crisis, a tourist tax could have a negative effect on visitor numbers.

Labour Mayor of Greater Manchester, Andy Burnham, has also rolled out a £1 visitor levy or “City Visitor Charge”, which has raised £2.8 million in a year for street cleaning and marketing campaigns. Chester, a Labour-majority council, has also recently pitched a £2-per-night accommodation tax to fund tourism events and improve visitor services.

Stiffer penalties for parents who take kids on term-time holidays?

Shadow education secretary, Bridget Phillipson, has spoken out against parents who remove their children from school to go on holiday. This came after a record 399,000 parents last year were issued a penalty notice by local authorities for unauthorised school absences.

“I think those parents that choose to take their children out of school for holidays or for trips or where it’s not necessary should reflect seriously, because that damages children’s life chances. They only get one chance at school, they only get one childhood,” she said on the BBC’s Sunday With Laura Kuenssberg programme in January.

“For those parents who are facing additional challenges and for children that are facing additional challenges an incoming Labour government will make sure that we put in place the support that’s needed to tackle that.”

During a speech at The Centre for Social Justice, Phillipson said a Labour government would introduce annual inspections on school trusts for the first time, to clamp down on absenteeism along with other issues facing schools: “Cheaper holidays, birthday treats, not fancying it today, these are no excuses for missing school,” she said.

The current Education Secretary, Gillian Keegan, said she wants to “rebuild the social contract between parents and schools and make sure everyone plays their part” and has introduced a £15m mentorship scheme to help 3,600 struggling children.

Airport expansions?

Sir Keir Starmer has spoken sympathetically about Gatwick Airport’s second runway plans. During a visit to the local area in February 2024, Starmer said: “Having grown up around these parts, I know just what a major hub Gatwick is for passengers going in and out of the country.

“For all of the local communities around here, it’s a massive source of work. It’s very important and we must never lose sight of that. We will have to take decisions in government about what we do about airport expansion and what the competing arguments are.”

Asked if he would support a second runway, Sir Keir said: “We will look at the situation as we go into the election. I’m a big supporter of Gatwick.” It is unclear whether Starmer’s Labour would back a third runway at Heathrow: in 2018, he voted against proposals alongside 93 other Labour MPs, although 119 Labour MPs backed the plans and the trade union, Unite, is also in support of the runway, calling it “fundamental”.

Interestingly, mentions of airport expansion and aviation are few and far between in Labour’s 4,000-word, 13-page environmental policy, except for one line which states: “[We] guarantee that any airport expansion adheres to our tests that require noise issues to be addressed, air quality to be protected, the UK’s climate change obligations met and growth across the country supported.”

Manchester Airports Group (MAG) – which manages Manchester, Stansted and East Midlands and is owned by a consortium of Labour-controlled councils in Greater Manchester – has plans to expand passenger numbers. Luton Airport, also owned by Labour-run Luton Borough Council, has plans for expansion too.

A more favourable exchange rate?

While markets tend to prefer continuity over change, history shows that governments elected with big majorities can imply stability, which in turn can make the pound more attractive – even if only temporarily. Last week one money expert predicted a three per cent rise in the value of sterling should Labour gain power.

Jasmine Birtles, chief executive of the personal finance website MoneyMagpie, told The Independent: “A Labour win with a large majority will imply some stability, making the pound more attractive to investors – at least for a few months. Figures are very difficult as there are so many variables, but if I were to pull one out of the air I would say a three per cent rise.”

On the flipside, the weeks leading up to an election can be precarious times for exchange rates. So if you are willing to gamble on a Labour victory, you may wish to wait to exchange your travel money until after July 4, as post-election exchange rates will likely be more favourable than they are now.

Swingeing taxes on private jets?

In a blog posted on labour.org.uk in January 2024, the party pointed out that the Conservative government had increased Air Passenger Duty (APD – more on that later) but the levy on private jet journeys remained frozen.

“This gobsmacking hypocrisy shows once again that Rishi Sunak is out of touch and simply can’t understand the concerns of the ordinary voters he claims to represent,” the Labour blog post purports. Starmer, in turn, was accused of hypocrisy after allegedly taking a £25,000 private jet owned by the Qatari government while attending a climate summit in the Middle East.

Still, given the tone of this official blog post, and the fact that Labour has previously hinted at banning private jets entirely, it would come as no surprise if levies on private jets went up under a Labour Government.

Cheaper flights from regional airports?

Air Passenger Duty (APD) is a charge added to economy tickets for UK departures, amounting to £7 for domestic flights and £14 for short-haul trips, increasing for longer flights and premium cabins. Some argue that this is putting regional airports at a disadvantage.

“London will always be fine, but where UK APD is doing untold damage is to the regional UK airports,” said Ryanair’s Chief Commercial Officer, Jason McGuinness. “We allocate capacity based on one metric only – that’s cost. [UK regional airports] are at an enormous disadvantage now versus their European competitors.”

Speaking at an aviation conference in November 2023, Labour’s shadow minister for aviation and maritime, Mike Kane, hinted at an adjustment to APD. “I am sure on the horizon we will look at how we allow our regional airports to compete in such an environment where they are disadvantaged at the moment,” he told delegates.

Better Wi-Fi (and cleaner loos) on the railways?

One of Labour’s major election pledges is to continue plans for the introduction of a new public body, Great British Railways, which will take charge of railway infrastructure and operations in the country. This concept appeared in a different guise under the premiership of Boris Johnson, when Grant Shapps was Transport Minister.

What the renationalisation of the railways looks like for passengers, according to Labour, is a more reliable timetable system based on Switzerland’s model of coordinating journeys across different modes of transport. They also promise a simpler ticket pricing structure, plus automatic compensation and digital season ticketing. On board, passengers are being told they will find better functioning power sockets, more reliable on-board Wi-Fi and – an election winner if you’ve ever seen one – cleaner toilets.

Labour has, however, stopped short of guaranteeing cheaper fares. Speaking at a press conference in April, shadow transport secretary Louise Haigh said: “I can’t today set out that we will lower fares. But we have said that we will simplify them, that we will make them more accessible, more transparent and more trustworthy for passengers.”

A clampdown on second homes and Airbnbs?

In a Parliamentary debate on May 23, 2023, Luke Pollard, a member of the shadow cabinet, said: “There are too many people in rural and coastal communities, such as those I represent in Plymouth, who are being turfed out of their homes and seeing those homes being flipped immediately into Airbnbs with astronomical rates.”

Pollard’s First Homes not Second Homes proposal calls for higher taxes on holiday lets and unused second homes, a licensing regime for second homes and a Community Infrastructure Levy (read: tourist tax) to support local businesses.

The Conservatives have also taken measures to manage the impact the accommodation platform has on local communities. Michael Gove announced in February this year that all second-home owners hoping to let their properties on Airbnb must get planning permission from this summer onwards, and Rishi Sunak has made sounds about penalising antisocial behaviour in Airbnb properties.