Kiwis flying out of the United Kingdom face hefty fare increases after an increase in British departure taxes that could cost up to $355.

The tax - designed to offset the effects of pollution created by the aviation industry - is being imposed on passengers according to flight distance bands. The further you fly, the more you pay.

Air Passenger Duty rose by up to 55 per cent this month and is the second rise in the last year.

The new rates are applied to all flights leaving the UK.


Premium tickets to New Zealand face taxes of up to $355 while economy class travellers will be charged half that amount.

The move has infuriated Prime Minister John Key, who yesterday blasted the tax as a revenue-collecting exercise on the part of the British Government.

"The departure tax the UK is putting on is not justified.

"Other countries may decide to put in place the same sort of departure tax.

"The previous Labour Government and the UK argued that this was based on environmental grounds. Our own Treasury provided all the supporting evidence to prove that wasn't the case."

He described the British move as very concerning, particularly for the effect it could have on tourist numbers.

The recession has already caused a drop in tourists from Britain, and Air New Zealand said the tax increase could cripple the recovering tourism sector.

Air New Zealand spokesman Mark Street said: "Air New Zealand is disappointed in this increase in the cost of travel for passengers, especially at a time when the tourism industry is doing everything possible to get back on its feet and grow visitor numbers."


He said the British Government trying to portray the increase as environmentally conscious was concerning because it did not provide an incentive for carriers to reduce emissions.

Tim Cassar, from the Tourism Industry Association, told TVNZ the tax increases could have a snowball effect with other countries.

"A small and isolated case at the start becomes an infection to what are really important source markets."

Brent Thomas from the House of Travel told TVNZ no price increase was ever well received by the public. "There are only very small increases to the overall cost of travelling from Britain to New Zealand."

Airlines have called the rises disgraceful, with Virgin Atlantic and British Airways saying they could prompt people to travel to Europe and leave from there.

- Additional reporting: NZPA