The UK government has updated its travel lists, with the Balearic Islands moving to the amber list from Monday morning.
The destination, which includes Ibiza, Majorca, Menorca and Formentera, has seen a sharp increase in cases of Covid-19 in recent days.
Cuba, Indonesia, Myanmar and Sierra Leone will be added to the red list from 04:00 on Monday.
Visitors who have departed from or transited through these countries and territories in the previous ten days will be refused entry into England.
Only British and Irish citizens, or those with residence rights (including long-term visa holders), will be allowed to enter and must stay in a government-approved facility for ten days.
But it is the Balearic Islands, which were only added to the green list at the end of June, that are causing the most concern for the travel sector.
An ABTA spokesperson said: “The decision to move the Balearic Islands to the amber list is a step back for the travel industry.
“Thousands of travel jobs and businesses are in desperate need of a successful summer season, and this further emphasises the urgent need for tailored financial support for a sector that has struggled to make any meaningful revenue for almost 18 months now.”
However, from Monday, fully-vaccinated travellers returning to England, Scotland and Wales from amber list countries will no longer need to self-isolate or take an additional test on day eight.
It is hoped this will minimise the disruption for vaccinated holidaymakers, but quarantine for non-vaccinated travellers remains a significant obstacle.
The ABTA spokesperson added: “Consumer confidence is essential if the industry is to trade its way out of this crisis, so the government must be more transparent about the criteria being used to move countries between the green, amber and red lists to allow travel businesses and customers alike to plan ahead.
“The government also needs to continue to capitalise on the successful vaccine rollout by expanding the green list in line with scientific evidence and reducing the need for and cost of testing, which is a significant barrier to travel for many people.
“Sufficient border control resource must also be provided at our ports and airports to help make travel as smooth as possible.”
Also today, Bulgaria and Hong Kong were added to the green list and Croatia and Taiwan to the green watchlist, meaning passengers arriving in England after 04:00 on Monday will no longer need to quarantine on arrival.
Croatia and Taiwan have been added to the green watchlist in recognition that these countries and territories are at risk of moving from green to amber.
Before travelling to England, everyone needs to take a pre-departure test and complete a passenger locator form regardless of where they are coming from.
If arriving from a green list destination, travellers will also be required to take a day two PCR test.
Arrivals from amber list countries and territories who are not fully vaccinated will need a day two and day eight test, and to quarantine for ten days.
The test to release scheme remains an option for non-fully vaccinated travellers returning from amber countries and territories to shorten their quarantine period.
Virginia Messina, WTTC senior vice president, said: “This will throw summer holidays into disarray for tens of thousands of people.
“Businesses given the lifeline of holidays to the Balearics will also be left floundering as bookings collapse and customers clamour for refunds, piling on further financial pressure.
“There may be some good news with Croatia and Bulgaria moving up the scale and being added to the green list.
“But the overall impact is one of confusion, which will only deter more Brits from holidaying abroad as the summer season slips away.”