Ryanair CEO Michael O’Leary slams UK government over travel tax plans

ryanair Chief executive Michael O’Leary warned the UK government on Monday about an effort to raise taxes on passenger flights, warning that the policy would force airlines to force planes out of the country.

Speaking to CNBC’s “Europe Early Edition” program after the news, stronger than expected Following its first half profit, the outspoken CEO described the Labor government’s push to increase air travel taxes as contrary to its strategy to kick-start economic growth.

His comments come ahead of the UK government’s high-stakes Autumn Budget on November 26, with Chancellor of the Exchequer Rachel Reeves under pressure to resolve the fiscal dilemma of spending, taxing and borrowing.

Ryanair’s O’Leary said there was a trend for European governments to roll back “crazy environmental taxes” and then be rewarded with rapid economic growth.

“So you see markets like Sweden, Hungary, Italy and Croatia eliminating environmental taxes, and then you have laggards like Germany, France and Rachel Reeves in the United Kingdom, who are talking about wanting growth in a remarkable way but on an island on the periphery of Europe, raising taxes on air travel,” O’Leary told CNBC’s Silvia Amaro on Monday.

“This reaffirms my belief that Rachel Reeves has no idea how to deliver growth, even though we have written to her that she is proposing significant growth, particularly in parts of the UK,” O’Leary said.

A Treasury spokesperson was not immediately available for comment when contacted by CNBC Monday morning.

CEO of Europe’s largest low-cost carrier puts UK first air passenger duty (APD) refers to the tax charged per passenger on flights from the UK to domestic and international destinations.

In last year’s Autumn Budget, Reeves announced strict rules limiting the government’s room for spending and borrowing manoeuvre, with day-to-day government spending financed by tax revenue rather than borrowing.

Prime Minister Keir Starmer’s government plans to increase APD rates by 50% for private jets and across-the-board increases for other flights from April next year, as part of a wider initiative to boost public finances and encourage more sustainable travel options.

Of course, APD, along with the Office for Budget Responsibility, is an important source of government revenue. don’t guess Revenues of £4.7 billion ($6.18 billion) were generated in 2025-2026. Meanwhile aviation known Being one of the fastest growing sources of greenhouse gas emissions.

O’Leary said the government’s plan to increase APD from April next year would represent a tax of almost 33% on the average price of a Ryanair flight, which is around £45.

“This is ridiculous,” O’Leary said. “For a family of four, this becomes prohibitive. We wrote to Rachel Reeves when she was first elected and said we could give you a 50% traffic increase, not in London but in the parts of England where growth is really needed in red-walled seats, Birmingham, Manchester, Glasgow, Edinburgh, Bristol.”

He added: “Abolish APD outside London. You know, London is full, London can pay APD but remove it outside London. That would cost them around £2bn out of their budget, they get that back in additional consumer spend, they get VAT on consumer spend from additional visitors in a year. No response.”