Hoteliers on the island claimed the restrictions have lost them "millions of pounds" worth of trade and called on Spanish authorities to relax its strict guidelines.
Tui reportedly said Mexico and Turkey are proving to be popular alternatives.
From Friday (11 February), people travelling to the UK will no longer need to take any Covid tests if they are fully vaccinated.
Hazel Bryant from Travel with Kitts, an independent agency in Hertfordshire, told the BBC the Omicron variant meant a lot of people re-arranged Christmas trips for half-term instead.
She said because the Canaries and mainland Spain require British children over the age of 12 to be double-jabbed, half the families she is dealing with have changed their plans.
"The reasons are, they’re not double vaccinated or because they’ve had Covid in the last six weeks - which means they haven’t gone for their second jab," she added. "Spain will not allow them in"
