The call to abolish the ‘tourist tax’ has garnered significant attention from the fashion industry.
- More than 300 fashion CEOs and business leaders have united against the policy, which they term a ‘spectacular own goal.’
- The absence of tax-free shopping singles out the UK as the only European nation not offering this benefit to tourists.
- The policy is criticized for stifling economic growth and impacting a broad range of sectors beyond luxury retail.
- Key political figures and influential organizations are joining the campaign to reverse this decision.
More than 300 CEOs, brand founders, and business leaders have aligned in opposition to the UK’s ‘tourist tax.’ They have addressed an open letter to Chancellor Rachel Reeves, emphasizing the policy as a ‘spectacular own goal.’ This collective stance reflects growing concerns over the competitive disadvantage it imposes on British businesses.
Retail executives such as Andrea Baldo of Mulberry, Neil Clifford of Kurt Geiger, and Paul Marsden of John Lewis, highlight that the UK remains the sole European country refraining from tax-free shopping for tourists. This situation leaves British businesses at a significant global disadvantage, as stated in the letter.
The proposition within the letter warns of a wide-reaching impact, disputing the notion that only luxury stores in London’s West End are affected. It argues that the removal of the VAT rebate prompts tourists to favor shopping destinations like Paris, Milan, and Berlin, thereby extending the repercussion to regional tourist hubs and various ancillary sectors, including hospitality and culture.
The letter supports its stance with findings from the Centre for Economics and Business Research, which quantified the economic damage as a loss of £11.1bn in GDP and deterring two million potential tourists annually. These figures exemplify the profound economic consequences of the policy.
Endorsement for the policy’s reversal spans high-profile political figures across party lines, including Labour’s Sadiq Khan, ex-Conservative Chancellors Sajid Javid and Nadhim Zahawi, as well as Lib Dem leader Sir Ed Davey. The letter appeals to the Chancellor, urging decisive action to scrap the ‘tourist tax’ and bolster economic growth.
Backing the call are renowned institutions and businesses such as Paul Smith, Bicester Village, the Royal Opera House, and Charlotte Tilbury Beauty. The widespread support underscores the urgent need for policy reconsideration to reinvigorate the UK’s appeal as a top shopping destination.
Abolishing the ‘tourist tax’ is imperative to rekindle economic vitality and enhance the UK’s global standing as a retail destination.
