UK tourism is bouncing back – but policy must keep pace

Tourism and hospitality are among the UK’s most valuable industries, contributing over £100 billion to the economy and supporting one in ten jobs.

According to VisitBritain, 2024 was on track to be a record-breaking year, with 41.2 million inbound visits and £31.5 billion in visitor spend, edging past previous highs set in 2017 and 2019.

The headline figures look great on paper, but as always, there’s more to the story.

While visit numbers are rising, spend per visit is down in real terms, particularly from long-haul markets. Business travel continues to lag behind pre-COVID levels, and the sector remains exposed to global volatility, changing visitor behaviour, and the rising cost of visiting the UK.

So what does this mean for tourism businesses on the ground?

Beneath the surface – mixed signals from 2024

At Monahans, we work closely with tourism and hospitality clients across the South West.

Many report that international travellers remain their highest-margin customers, but are still spending cautiously, or in some cases, choosing other destinations entirely.

While VisitBritain’s 2025 forecast is optimistic, predicting 43.4 million visits and £33.7 billion in spend, the organisation notes that the balance of risks is to the downside.

Factors such as rising tourism prices, the introduction of electronic travel authorisations (ETAs), and the removal of VAT-free shopping for overseas visitors could all limit growth, especially when other European destinations are perceived as easier or more cost-effective alternatives.

Policy should help and not hinder recovery

With tourism bouncing back, policy should support that momentum, not slow it down.

There is a sense within the industry that recent decisions have created friction for visitors, whether through increased Air Passenger Duty, changes to entry requirements, or the 44 per cent cut to VisitBritain’s marketing budget.

These changes may seem small in isolation but, taken together, they can make the UK a harder sell on the global stage.

How tourism businesses can strengthen their position

Regardless of national policy, businesses can take proactive steps to stay resilient.

We would recommend:

• Scenario modelling – Understand how exposed you are to changes in international visitor numbers or domestic spend

• Cashflow forecasting – Prepare for seasonal fluctuations and unexpected costs

• Tax planning – Take advantage of reliefs like Capital Allowances or R&D where available

• Review your pricing strategy – Reflect rising costs without pricing out key markets

• Structure for success – If you operate multiple sites, consider whether your business structure is tax-efficient and growth-ready

We have worked with tourism businesses to embrace new tech, find funding, and even plan their next chapter.

While we all wait for clearer data and stronger support from policy, we are here to help you do the best with what you have got.

Tourism may be bouncing back, but it still needs the right conditions to thrive. If you would like expert advice for your business, contact us today.

Simon Cooper