Cross-party MPs have warned that a u-turn on tax-free shopping for overseas tourists is “short-sighted and incredibly damaging” as the tourism sector hopes to recover post-Covid.
In a new report, the Digital, Culture, Media and Sport (DCMS) Committee said Chancellor Jeremy Hunt’s u-turn was hindering the sector.
The committee said it felt the government was failing to recognise the value of the inbound tourism industry, which was worth 3.2m jobs and nine per cent of GDP.
Chair of the DCMS committee Julian Knight MP dubbed the move to ditch the policy as “a spectacular own goal” by ministers.
“In an increasingly competitive global market, Britain cannot just rely on its reputation alone to attract visitors,” he said.
“It must make it easier for people to travel and access the full range of outstanding attractions all over the country.”
The Association of International Retail said yesterday that it was now urging the Chancellor to seek an independent assessment of the impact of the u-turn of the policy from the Office for Budget Responsibility, “so that any future decision can be made on full and accurate information.”
Paul Barnes, chief executive of the AIR – whose members range from Bicester Airport to Heathrow Airport – told CityA.M. last week that the policy had been “one of the few measures in the growth plan that would have directly and quickly lead to increased economic growth across the country.”
High spending international visitors from the US and Gulf States were “shunning Britain” currently and jetting off for shopping sprees in Paris and Milan while “giving London a miss,” Barnes said.