MPs to debate axing Tourist Tax in partial victory for campaigners

Is the Chancellor finally listening to businesses? MPs to debate axing Tourist Tax in partial victory for companies campaigning for change

• Treasury will have to respond to campaign to reintroduce VAT-free shopping 
• It comes after MPs and peers backed the Mail’s ‘Scrap the Tourist Tax’ campaign 

Calls for a tourist tax to be scrapped will make it to a Commons debate amid signs the Chancellor could finally be listening to businesses.

In a partial victory for the hundreds of prominent companies who have urged the Government to change tack, MPs will discuss the issue in a 90-minute debate after the summer recess.

It means the Treasury will have to formally respond to a campaign to reintroduce VAT-free shopping, after bosses have said absence of such a scheme is making the UK less internationally competitive.

It comes after officials working for Jeremy Hunt were asked to find evidence of the ‘wider economic impact’ of the 2021 shift that meant tourists could no longer claim back a 20 per cent VAT rate charged on their purchases. 

Dozens of cross-party MPs and peers have backed the Mail’s ‘Scrap the Tourist Tax’ campaign, including former home secretary Priti Patel, as have firms such as Harrods.

Businesses have argued the Government had not fully assessed what taking away the scheme would mean for the wider tourist ecosystem.

It comes after officials working for Jeremy Hunt were asked to find evidence of the ‘wider economic impact’ of the 2021 shift that meant tourists could no longer claim back a 20 per cent VAT rate charged on their purchases

READ MORE: Priti Patel leads dozens of MPs and peers calling for Rishi Sunak to scrap the controversial ‘tourist tax’ 

‘It is really important that this subject is thoroughly debated in Parliament, which will hopefully send a strong message to the Chancellor ahead of the Autumn Statement,’ said Sir Geoffrey Clifton-Brown MP, treasurer of the 1922 Committee, who pushed for the debate, scheduled for September 7.

Shoppers are thought to be heading to rival cities such as Paris and shunning the chance to splash their cash in the UK.

Dee Corsi, chairman of the Association of International Retail and chief executive of the New West End Company, said the debate was ‘a sign of how serious this issue is for Britain’s economy’. She added: ‘The tourist tax has already had a negative effect on many businesses in the West End and beyond, as retailers, hospitality, and leisure providers grapple with the loss of spend being diverted across the Channel.’

Rishi Sunak has claimed scrapping the scheme saved the country’s coffers £2billion but business leaders have suggested there could be a net gain of £350million.

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