Secretary of State for Education Nicky Morgan MP said the government would need to maintain Air Passenger Duty (APD) and its current tourism VAT levels until it sees evidence of the benefit without the taxes.
On a panel during the convention Morgan fought back against complaints that APD and high VAT is making Britain uncompetitive to others by being too expensive.
“We’ve managed to keep Air Passenger Duty down on short-haul flights and have made some changes to bands in recent years,” she said. “I’m yet to see a compelling overall case to support what we have heard about the economic benefits [without APD].”
Her comments come despite several campaigns and lobbying from various travel firms and groups, which argue that without the tax flights would become cheaper and more people would come to the UK.
Morgan also dismissed calls to reduce VAT for tourism, saying she needed the money from both taxes to fund areas such as education.
“The Treasury’s analysis into cutting VAT is that it would not outweigh the loss of the tax. Travel is not the only industry fighting to see VAT reduced,” she said.
Gerry Sutcliffe, who is on the Tourism Select Committee, said the issue of VAT had been raised and it would ask the Chancellor to look at tourism tax.