Heathrow joins calls to bring back VAT-free shopping for tourists

Heathrow bosses have told ministers they must ‘restore’ VAT-free shopping as visitors to France and Spain spend more than double what they do here.

According to Europe’s busiest airport, British businesses are losing out to neighbors as the government refuses to budge on the so-called tourist tax.

While spending by US tourists in the UK has returned to pre-pandemic levels, their shopping in Spain and France has doubled and are now at 201 percent and 226 percent of 2019 levels, respectively, according to data from the tax refund firm. for tourist shops Global blue.

Shoppers from across the Atlantic are also spending nearly twice as much in Italy as before the lockdown, reaching 190 percent of 2019 levels.

This trend extends to visitors from the Middle East and South East Asia, who spend less and less money on British goods than in other European hotspots.

This raised concerns that London could fall behind Paris and Madrid.

Heathrow is one of more than 200 companies that have supported the Daily Mail’s Scrap the Tourist Tax campaign.

Well-known names such as Harrods, Burberry and Marks & Spencer are also behind the campaign. VAT-free shopping was abolished by Rishi Sunak when he was Chancellor in 2021.

It means that foreign shoppers are no longer entitled to a 20 percent refund of their shopping basket.

While countries in Europe charge VAT, they also offer a refund for foreign visitors who take purchases home.

There is a growing unease that the loss of Britain’s tax break is a major own goal, with the tourist tax hitting the UK economy while boosting sales in the EU.

A Heathrow spokesperson said: “The government needs to reintroduce tax-free shopping to help UK businesses and the UK economy take maximum advantage of recovering markets, rather than losing out to neighbors in France, Italy and Spain.”

About 99 per cent of the airport’s retail and restaurant spaces were occupied before the pandemic, but the level stands at just 95 per cent today – with Heathrow blaming the tourist tax.

Bosses of 20 airports, including Gatwick, Edinburgh and Belfast, have also put pressure on the government to reintroduce the tax break.

Critics say that – far from the Treasury’s claim that abolishing the tourist tax would cost £2bn a year – there would be a net gain of around £350m.

A study by consultancy Oxford Economics suggests the move would boost the economy by £4.1bn and support 78,000 jobs.

Tourists felt “isolated and penalized,” says Savile Row’s first female tailor

Savile Row’s first female master tailor has warned tourists are feeling “isolated and punished” by the UK for shelving a VAT-free shopping programme.

Kathryn Sargent has joined designer fashion houses Burberry and Mulberry in backing an email campaign to get rid of a hated ‘tourist tax’.

Sargent, who has made suits for members of the royal family, said the tax “drifted” spending from London’s illustrious Mayfair to rivals in Paris or Milan.

Cut the tax: Savile Row master tailor Kathryn Sargent joins designer fashion houses Burberry and Mulberry in calling for VAT-free shopping for tourists

The capital is failing to welcome tourists just as it needs to lure them back after the pandemic, she added.

She urged the government to “understand that psychologically [scrapping the tax] really means a lot to our international customers’.

“You don’t want them to feel cut off from travel because they feel they are not valued by our government,” Sargent told the Mail.

“They know their business is valued by me, but it has a pretty broad psychological impact on that customer’s mindset. I see that first hand.

“I see no advantage in this decision, there is more loss than gain.”

Sargent called on ministers to recognize that the tax does not only affect ‘luxury people’ who are rich and can therefore ‘afford it anyway’.

Instead, she urged the government to consider the tailors behind the scenes in the workspaces as “everyday, normal people.”

Tourists also support the entire economy when they visit London, Sargent said.

“They stay in hotels, go to the theater, do things that tourists usually do,” she added.