Jet2 chief executive Steve Heapy has urged Chancellor Rachel Reeves to stop using the airline and holiday industry as a “cash cow”, warning that any further increase in aviation taxes will hit lower earners hardest and risk pricing families out of foreign travel.
Heapy — who runs Britain’s largest package holiday provider and the UK’s third-biggest airline by passenger numbers — said that higher taxes would “inevitably” be passed on to passengers, pushing up fares and dampening demand.
“As we all know, we can’t escape the fundamental laws of economics,” he said. “Increased prices could result in decreased demand, and that’s not good because the people who will be unable to afford a holiday will be the lowest earning members of society. It would be a perverse outcome if flying became something for the rich and privileged.”
The warning comes as speculation grows that Reeves may turn to the aviation sector for additional revenue in next week’s Budget. Air passenger duty (APD) — paid by almost every air traveller departing from a UK airport — last increased in April and is scheduled for another rise next spring. Current APD rates range from £14 for domestic flights to £224 for long-haul journeys over 5,500 miles.
Heapy’s comments accompanied Jet2’s half-year results, which revealed record revenues of £5.3 billion, up 5 per cent year-on-year. Seat capacity rose 8 per cent to 16 million, driven in part by new operating bases at Bournemouth and London Luton. Pre-tax profit (adjusted for foreign exchange movements) increased 1 per cent to £780 million.
The airline reported a 16 per cent rise in flight-only passengers to 4.7 million in the six months to September, reflecting the industry-wide trend of travellers booking much later than usual. Net ticket yields fell 7 per cent as Jet2 used promotional pricing to stimulate demand. Package holiday passenger numbers grew 1 per cent to 4.7 million.
Jet2 confirmed that it expects full-year operating profit to align with consensus forecasts of £453 million. The company’s financial year is heavily weighted to the summer period, with the second half typically generating lower profits.
The results offered reassurance after a profit warning in September, when Jet2 told shareholders it expected full-year adjusted profits to come in at the lower end of market expectations due to limited forward visibility and more cautious consumer spending. In response, the airline cut 200,000 seats from its winter schedule, reducing total winter capacity to 5.6 million.
Despite the pressures, Heapy said demand remains resilient: “It is clear customers still want their well-earned holidays in the sun, even if they book closer to their departure date.”
The update comes a week after Jet2 announced it will begin services from London Gatwick in March 2026, after securing slots for six aircraft. The move gives the airline a foothold at the UK’s second-largest airport, but analysts say it will face intense competition — particularly from easyJet, which bases more than 70 aircraft there.
Jet2 expects the new Gatwick operation to turn profitable by 2029.
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Jet2 chief warns Reeves not to treat aviation as a ‘cash cow’ ahead of Budget
