A US businessman has vowed never to use the phone in his room at a Manchester hotel again after running up a bill almost as large as his bill for five nights' bed and breakfast.

When Mr John Burke checked out of the Palace Hotel, his account showed that he owed £459.31 sterling for calls which would have cost about £20 had he used a public payphone.

Mr Burke, a consultant computer designer from California, was astonished to discover that a 26-minute call to a mobile phone in Britain had set him back £176.64 (£6.70 a minute) and that a 14-minute call to Frankfurt had cost more than £100 (£7 a minute).

Had Mr Burke used a phone box, the call to the mobile could have cost £5.20 and the call to Frankfurt £4.

Less than five minutes of early-morning talk to Leicester cost Mr Burke just under £9 and 10 minutes to High Wycombe in the evening added £10 to his bill. And he was also charged more than £48 for calls to freephone numbers. He does not dispute that he made 21 calls from his room but claims he has not met such steep charges anywhere else in the world.

"It would have been cheaper for me to have made all those calls on my mobile phone," he said. "It wouldn't put me off coming to Manchester, but next time I would ask the hotel for a full phone tariff."

The Palace charges 32p a unit, a high rate compared with other Manchester hotels but not as high as the Savoy in London which charges 50p. Units used will depend on the time and duration of the call and calls to mobiles are the most expensive.

"If they are going to charge that much, they should write it in very large print on a sign in the room," added Mr Burke.

British Telecom rates range from 7.91p for a long-distance daytime call to 1p for a local call at weekends.

Mr Burke queried the bill and the Palace, owned by Harrogate-based Principal Hotels, has agreed to refund the cost of the Freephone numbers and to cut the rest of the bill by a quarter. A spokeswoman said the company conformed with guidelines set by industry watchdog, Oftel, and that a recent survey showed its charges were in line with those made by other hotel groups.