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Rachel Reeves should cut taxes rather than back Heathrow expansion if she wants to boost the economy, Ryanair’s finance chief has said.

Neil Sorahan said scrapping a planned increase in airline passenger tax would do far more to encourage short-term growth than building a new runway at Heathrow.

Mr Sorahan said halting the increase in the departure tax would boost passenger numbers and bolster the argument for investment in airports. By contrast, capital-spending projects such as building a new runway at Heathrow would “take forever” to yield results.

Planned increases in air passenger duty (APD) announced in the Budget mean Ryanair is cutting UK flights just as the Chancellor seeks to stimulate the economy.

Mr Sorahan said: “It’s a strange message to be sending out, that ‘costs are going up but we’re going to put more runways in place’.

“If they [ministers] really want growth in the short term the easiest thing they can do is reduce APD. That will bring more flights into the UK that will back up their case for more runway capacity.”

The comments come after the Chancellor gave the strongest hint yet that she will back a third runway at Heathrow, telling the BBC she is prepared to make tough decisions in pursuit of economic growth.

Ms Reeves is expected to signal Labour’s support for the runway and expansion of Gatwick and Luton airports in a speech this week.

‘Short sighted decision’

Mr Sorahan said Ryanair’s business in Britain will be “broadly flattish” this summer but said the budget airline will fly fewer routes and serve those still in service less frequently from 2026 as the ramp up in APD takes effect.

He said: “You’ll start to see capacity going out unless there’s some meaningful movement by the Government.

“They aren’t helping themselves with these tax increases. It was a short sighted decision because it makes the marginal costs of operating in the UK uncompetitive.”

He added: “I have nothing against the UK but it’s not competitive at the moment and we have to put the capacity where the best opportunities are.”

Michael O’Leary, the Ryanair chief executive, has called Ms Reeves decision to raise APD “idiotic” and said in November the Chancellor “has no clue how to deliver growth in the UK economy”.

Mr Sorahan’s comments came as Ryanair cut its passenger target for the coming year for the second time since November, predicting it will carry 206m people in the 12 months from April, 9m fewer than first planned.

The Irish airline will cut flights to parts of Germany and Spain this summer, while boosting services to Italy – now its largest market ahead of the UK – Sweden and East European nations including Poland and Slovakia.