Rip-off of expensive tourists wreaks havoc’: Rishi Sunak and Jeremy Hunt face growing revolt over the abolition of tax-free shopping for foreign tourists
Rishi Sunak and Jeremy Hunt faced a growing backseat revolt last night over the abolition of VAT-free shopping for foreign tourists over fears the UK might lose out to European rivals.
Sir Iain Duncan Smith became the latest heavyweight to call on the government to reinstate the policy. The former Conservative leader said: “What we get for what we give will be much greater and it would help the economy.”
And Tory MP Julian Knight warned that Paris had “stolen a march” to London, with a drop in high-priced tourists wreaking havoc on restaurants, bars, theaters and hotels.
By shopping VAT-free, tourists can claim back 20 percent of their purchases. It was abolished by the then Chancellor, Mr Sunak, when the UK left the EU. Kwasi Kwarteng tried to reintroduce it, but the new chancellor, Mr Hunt, reversed the plan, claiming it would save £2bn a year.
Rishi Sunak (pictured) and Jeremy Hunt faced a growing backseat revolt last night over the abolition of VAT-free shopping for foreign tourists amid fears the UK could lose out to European rivals
Tory MP Henry Smith said the government’s calculations show a ‘false savings’. Mr Knight agreed, adding: ‘What the government has done is making Britain a much less attractive place for foreign visitors. The government loses income because those visitors do not come. It is no coincidence that on the day Britain abolished duty-free shopping, France relaxed their regime.
“Paris stole a march on London as a result. And when the Chinese visit again, they will not go to destinations where duty-free shopping is not possible.
“I call on the government to ignore the Treasury Mandarins who came up with this plan.”
VAT free shopping was abolished by then Chancellor Sunak when the UK left the EU. Kwasi Kwarteng tried to reintroduce it, but the new chancellor, Mr Hunt (pictured), reversed the plan, claiming it would save £2bn a year
The impact of the UK’s status as the only major Western economy not offering a tax break is being felt across the country.
Bicester Village, the designer shopping center in Oxfordshire, said it has seen a ‘tourism shift’ to Europe.
Manchester’s tourism board, Marketing Manchester, said the abolition of VAT-free shopping had been a ‘hammer blow’, while the New West End Company, which represents hundreds of shops in London, said the decision had ‘disastrous consequences’.