The UK is doomed under Labour, the boss of Ryanair has warned as he claimed wealthy people were scrambling to ‘get the hell out of London’ before being hit by a Budget tax raid.
Michael O’Leary said he had no faith in the Chancellor’s ability to restore growth and branded her tax policies ‘dumb’.
The comments came amid reports that Rachel Reeves is planning to target the wealthy with a mansion tax in the Budget later this month.
He told the Guardian: ‘The UK economy under the current leadership is doomed.
‘The UK badly needs growth, but the way to deliver growth is through selective tax cuts… you are not going to grow the UK economy by taxing wealth or taxing air travel.’
Mr O’Leary’s comments add to a chorus of criticism of Labour from UK business leaders – following warnings about tax from the likes of Marks & Spencer boss Stuart Machin and Asda’s Allan Leighton.
Michael O’Leary branded Labour’s policies ‘dumb’
The Ryanair boss said: ‘I hold very little faith in Rachel Reeves or the current economic strategy of the Labour government.
‘Rich people are fleeing… as they are trying to find low-fare flights to get the hell out of London before Rachel Reeves taxes their mansions, their income and inheritance.’
Mr O’Leary has also taken umbrage at Labour’s decision to hike air passenger duty – a tax on flights – and said further increases in the Budget would prompt the carrier to shift capacity to other countries with lower tax burdens such as Sweden or Italy.
He told Bloomberg: ‘She hasn’t a rashers how to deliver growth. She puts up employment taxes, puts up APD.’
Mr O’Leary said Ryanair had written to the Treasury describing the increase in the air tax as ‘the dumbest idea even you lot have come up with’.
He said that a further increase at the Budget would mean 10 per cent of Ryanair’s capacity, or about five million seats, is moved to lower tax countries.
‘Eventually even a dumb Labour government will work out that for an island on the periphery of Europe, the way to grow – and the way to increase tax revenue – is to get tourists onto the island first and then tax them,’ he added.
‘The way to grow is not by increasing entry taxes, which is what APD is.’
Mr O’Leary made the comments as the airline revealed a surge in half-year profit amid a hike in fares. It was also helped by aircraft deliveries helping it fly more passengers.
The low-cost airline reported a pre-tax profit of £2.6 billion for the six months to the end of September, 40 per cent higher than the same period last year.
It flew 119 million passengers, 3 per cent more than last year
Average airfares rose by 13 per cent year on year to 58 euros (£50.90), Ryanair revealed, having spiked during the Easter period.
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