Air passengers across the UK are being warned to expect higher ticket prices as regional airports face what industry experts describe as “unprecedented” increases in business rates from next year.
Analysis of government data shows that regional airports are among the worst affected by the overhaul of property valuations used to calculate business rates. While major London hubs such as Heathrow and Gatwick are also facing sharp rises, the steepest increases are concentrated outside the capital, putting particular pressure on airports serving regional economies.
Figures compiled by global tax firm Ryan, based on Valuation Office Agency data, reveal that rateable values for some regional airports have risen more than sixfold under the latest revaluation. This dramatic jump will translate into significantly higher tax bills, even after transitional relief is applied.
Soaring bills despite relief measures
Although transitional relief will cap business rates increases at 30% in the first year, many regional airports are still expected to experience some of the largest cash increases of any sector in the UK. Over the next three years, most airports are forecast to see their business rates bills more than double.
Manchester Airport is among the most heavily affected, with its bill expected to rise by £4.2 million to £18.1 million next year. Bristol Airport faces a £1.2 million increase to £5.2 million, while Birmingham International Airport is set for a £1.8 million rise to £7.6 million. Newcastle International Airport is expected to see its bill climb by nearly £245,000 to £1.1 million.
Other regional airports facing large increases include Liverpool Airport, with a £233,100 rise to £1 million, East Midlands International Airport, with a £437,895 increase to £1.9 million, and Bournemouth Airport, where the bill is forecast to rise by more than £100,000.
Impact on ticket prices and investment
Industry experts have warned that airports cannot absorb cost increases of this scale without passing them on. Alex Probyn, Ryan’s practice leader for Europe and Asia-Pacific property tax, said the sector-wide uplift of nearly 300% would inevitably feed through to passengers.
He said the increases would first raise airport charges, then airline operating costs, and ultimately lead to higher ticket prices for travellers. Airlines already face rising fuel costs, environmental charges and staffing pressures, making it harder to shield passengers from additional costs.
Airport operators have also warned that the surge in business rates could delay or reduce planned investment in infrastructure, terminals and sustainability projects at a time when demand for air travel is recovering strongly.
Warnings from airport operators
A spokesperson for Manchester Airports Group said airports had anticipated paying more but described increases of more than 100% as forcing a rethink of long-term investment plans. The group had planned to invest more than £2 billion across its UK airports over the next five years, but said the scale of the tax rise made that increasingly difficult.
They warned that higher costs would make air travel more expensive for passengers and harder for UK businesses that rely on global connectivity and efficient supply chains.
Concerns over regional economic impact
AirportsUK, the trade body representing the sector, said the government’s business rates proposals were shortsighted and risked damaging regional economies. The group warned that higher airport costs would have knock-on effects for tourism, trade and local employment in areas that depend heavily on airport connectivity.
The organisation is preparing a response to a Treasury consultation on business rates reform, which closes in February. It welcomed the government’s announcement of a longer-term review into how airport business rates are calculated, saying reform was essential to support future investment and economic growth.
Business rates have long been a point of contention for airports, which argue that the current system does not reflect the cyclical nature of aviation or the strategic importance of regional air links for the UK economy.
