Half-term holiday bookings are expected to surge after ministers unveiled a simplification of Covid foreign travel rules, replacing the traffic-light system with a single red list and bringing in a laxer regime for tests.

But while MPs and some travel groups welcomed the new system, airlines voiced anger that fully vaccinated travellers returning to England will still have to take a test after they return, even if this will be changed to a cheaper lateral flow version.

Willie Walsh, the former British Airways boss who now heads the International Air Transport Association trade group, said that, while Friday’s changes were a move in the right direction, it was time to scrap the entire “wasteful and ludicrously expensive” system of tests for fully vaccinated travellers.

The new system for arrivals in England set out by the Department for Transport was also less ambitious than expected in some areas. A great shortening of the red list had been forecast, but just eight countries were removed.

Under the new regime, the current designation of red, amber and green countries will be replaced by a smaller red list, with double-jabbed travellers coming from all other countries not required to quarantine.

The countries to be taken off the red list from 4am on Wednesday are Bangladesh, Egypt, Kenya, the Maldives, Oman, Pakistan, Sri Lanka and Turkey.

But predictions that up to half the 60-plus countries on the red list would be removed proved mistaken, angering tourism groups. The Southern Africa Tourism Services Association, which represents about 1,350 South African businesses, called the decision “a kick in the teeth”.

If a country is on the red list, travellers there from England must quarantine inside an approved hotel for 10 days once they return at a cost of £2,285 per adult.

The new rules will simplify testing rules for travel. From 4 October, fully vaccinated travellers will no longer need to take a test before departing for England.

From the end of October, while people will still need to take a test within two days of returning, this can be a cheaper lateral flow test rather than a PCR.

Unvaccinated people returning from countries not on the red list will still need to take a pre-departure test, and PCR tests on days two and eight, with the option of leaving quarantine earlier via test-to-release, as before.

All travellers will still need to fill out a passenger locator form before coming to England.

In another change, from 4 October, people vaccinated in 17 countries and territories, including Israel, Japan, Singapore and South Korea, will be treated like domestic travellers.

Travel is a devolved matter, and it will be up to the other UK governments whether they follow suit. The Welsh government said it would “carefully consider” the new system.

On Friday evening the Scottish government announced that it will end its current traffic-light system for international travel but will not follow England in further easing Covid-19 testing for those entering the country.

Those arriving in Scotland will still need a negative pre-departure test – including from non-red list destinations – and a negative PCR test on day two after arrival, even if they are fully vaccinated.

The transport secretary, Grant Shapps, who unveiled the new system in a series of tweets, said it was “a proportionate updated structure that reflects the new landscape” and would help the travel industry.

Huw Merriman, the Conservative MP who chairs the Commons transport committee, said he hoped the announcement, “timed ahead of October half-term, could have an immediate impact on the UK’s travel industry”.

He added: “The committee has called out confusing watchlists and quarantines, criticised the delay in reaping the benefit of the vaccine dividend and puzzled over the high costs and lack of sequencing of PCR tests.”

However, a series of airlines and aviation industry groups questioned the continued use of post-arrival tests for fully vaccinated travellers, with Sean Doyle, the British Airways head, saying the airline would “urge ministers to keep this policy under review, eliminating all testing for fully vaccinated travellers as soon as possible in the future, in line with most other European countries”.

Johan Lundgren, the chief executive of easyJet, said he welcomed the changes, but added: “Since 1 July there has been no testing at all for vaccinated travellers within the rest of Europe, and this is why the UK will continue to fall further behind the rest of Europe if this remains.”

Downing Street, asked before the changes, said that as with all Covid measures the rules would be kept under review in case the health situation changed.