Ryanair blames Reeves’s ‘idiotic’ tax grab as it cuts thousands of flights

Michael O’Leary says the Chancellor has ‘no clue’ how to deliver growth

Ryanair is to cut thousands of UK flights as its chief executive blamed an “idiotic” tax grab by Rachel Reeves.
The airline said it would cut UK capacity by as much as 10pc next year, equivalent to a reduction of around 5m passengers after the Chancellor announced a rise in air passenger duty (APD), which is levied on flights starting in the UK.
Michael O’Leary, the Ryanair chief executive, accused the Chancellor of a short-sighted tax grab he said demonstrated that she “has no clue how to deliver growth in the UK economy”.
He added: “Reeves has damaged the UK’s growth prospects and made air travel much more expensive for UK families travelling abroad on holidays or to visit friends and family.
“At a time when Ireland, Hungary, Sweden and many regions in Italy have abolished air travel taxes, Chancellor Rachel Reeves’s idiotic decision to further raise the UK’s already-high air travel taxes will deliver cuts, not growth.”
The Government’s decision to increase air passenger duty by £2 per passenger for short-haul flights means a family of four flying to Spain next year will pay £60 in travel taxes, Ryanair said.
Mr O’Leary said regional airports were likely to be “particularly damaged” by the tax rise as reduced passenger numbers lead to fewer flights, higher fares and ultimately job losses. Domestic services would be hard hit because travellers pay APD twice, the chief executive predicted.
He said: “As an island economy on the periphery of Europe, it is vital that the UK lowers air access costs.
“If Labour are serious about their claims to deliver growth they should start by scrapping APD. Instead, their first Budget has damaged growth, damaged tourism and damaged air travel.”
Mr O’Leary told The Telegraph last month that Ryanair was ready to move more planes to the UK if the Government reduced APD, which he referred to as “a penal tax on the poor.”
But he warned at the time Ryanair was prepared to axe flights if the Government imposed tax increases that hurt demand and undermined the viability of routes.
He pointed to cities including Glasgow, Edinburgh and Belfast as particularly vulnerable, where he said capacity had been increased but profitability remained marginal.
Ryanair said earlier this year that it would slash 12pc of its capacity in Germany in protest against higher taxes.
Low-cost airlines are uniquely positioned to respond to changes in demand and costs by shuffling their route networks. Ryanair stations jets at 95 airports across Europe, whereas traditional carriers such as British Airways tend to concentrate their resources at a single hub.
A shortage of planes amid delayed deliveries from Boeing also means that capacity is at a premium at Ryanair, which Mr O’Leary has suggested will cut its system-wide passenger target for 2025 by 5m as a result.
The company is due to report results for the six months through September on Nov 4.