Abta chairman John McEwan has warned that Britain will lose its international competitiveness without airport expansion.
Mr McEwan branded the government's decision to rule out airport expansion in south east England as "unacceptable", and that financial protection for holidaymakers needed to be strengthened for customer confidence.
Although he welcomed the decision outlined in the Budget to defer this year's rise in Air Passenger Duty (APD) airport departure tax until next year, he urged the government to go further in its plans for reform.
"We believe we need to go a great deal further on APD. It's not about the level of tax, it's about the fairness of tax," he said.
The travel chief said that the government's plans to improve financial protection only covers around half of travellers.
He said: "We want to see every holiday protected, regardless of how it's booked."
One criticism of APD is that those flying to the Caribbean pay more than those flying a greater distance to the west coast of the USA.
Treasury minister Justine Greening admitted that whichever way APD was reformed, there will be "some anomalies - it's inevitable".
She added that while the government reduces the deficit, it would not be "easy to move away from tax revenues already in place" for aviation taxation.