Duty-free shopping will be reinstated for overseas visitors to the UK
Duty-free shopping in the UK will be reintroduced for overseas visitors, the country’s new chancellor announced on Friday.
Tourists will soon be able to reclaim the full value added tax paid on goods in plans unveiled by the government.
Previously, buyers could reclaim taxes before leaving the country at airports and refund agencies.
But former Chancellor Rishi Sunak scrapped the rebate on December 31, 2020, despite fears it would cost 40,000 British jobs and £1bn ($1.12bn) in investment.
Speaking in the House of Commons to announce the new government’s mini budget, Kwasi Kwarteng said the move would benefit UK retailers.
“Britain welcomes millions of tourists every year and I want our high streets and airports, ports and shopping centers to feel the economic benefits,” he said.
“We have therefore decided to introduce VAT-free purchases for foreign visitors.
“We are going to replace the old paper system with a modern digital system.
“It will be implemented as soon as possible. It’s a priority for our major UK retailers, so it’s also our priority.
The move is part of a series of measures announced on Friday designed to break the “stagnation cycle” in Britain’s economy.
They include a reduction in the basic income tax rate to 19 pence from April 2023 and the abolition of the top tax rate for high earners.
The government also lifted the cap on bankers’ bonuses, raised the stamp duty threshold to £250,000 and reversed an increase in National Insurance.
“We need global banks to create jobs here, invest here and pay taxes here in London – not in Paris, not in Frankfurt and not in New York,” Mr Kwarteng said.
“We are securing our place in a fiercely competitive global economy, with lower corporate tax rates and lower personal tax rates.”
Updated: September 23, 2022, 09:49