Now 200 firms say the tourist tax should be taxed

Now 200 firms say the tourist tax should be taxed: Bosses of Selfridges and The Ritz join our fight to get UK booming

• Kemi Badenoch, the Business Secretary, is understood to have heard complaints 

Two hundred firms have now backed the Mail’s campaign to bring back tax-free shopping for overseas tourists.

The boss of The Ritz London yesterday joined the growing clamour of calls for the Chancellor to scrap the hated ‘tourist tax’ and give a much needed boost to the economy.

Department store Selfridges has also given its backing to the campaign, with leading figures from across the retail, hospitality and tourism sectors describing the removal of the VAT refund for visitors as an ‘extraordinary own goal’. The message is getting through to the upper echelons of government, with Cabinet ministers said to be taking up the case for the reinstatement of the perk.

Kemi Badenoch, the Business Secretary, is understood to have heard complaints from businesses and has been raising their concerns with colleagues.

And Conservative Party chairman Greg Hands – whose Chelsea and Fulham constituency is heavily affected by the tax – is also thought to strongly back the campaign. In a letter to Jeremy Hunt, organised by leading hotelier Sir Rocco Forte and now signed by 200 top businesses, bosses say the return of tax-free shopping for tourists could bring in hundreds of millions of pounds a year.

The boss of The Ritz London yesterday joined the growing clamour of calls for the Chancellor to scrap the hated ‘tourist tax’ and give a much needed boost to the economy

The Daily Mail’s ‘Scrap The Tourist Tax’ campaign, which has won cross-party backing, was launched in support of the calls for the Government to think again.

Sal Gowili, general manager of The Ritz London, yesterday said he was joining the campaign to ‘allow us to compete on a level playing field to the rest of Europe’.

Cakemaker who’s losing a big slice of her income

BY EMILY HAWKINS

Peggy Porschen, who owns the London cakemaker of the same name, said the tourist tax is driving away sweet-toothed tourists.

She said there has been a dramatic drop in European and Asian visitors since the loss of tax-free shopping, even as travel rebounds after Covid.

The former flight attendant runs two cake parlours in Belgravia and Chelsea and said business from overseas tourists used to be booming.

Ms Porschen said: ‘If we rewind to 2019, queues to enjoy our tiny corner of London’s Belgravia were the norm.’ But now tourists favour cities where they can receive a considerable discount on retail purchases.

Peggy Porschen (pictured), who owns the London cakemaker of the same name, said the tourist tax is driving away sweet-toothed tourists

She said: ‘All you need to do is speak to our front-of-house team and they’ll tell you the drop in both European and Asian visitors has been sharp.’ She is now considering shunning the UK to expand her business in another country.

Ms Porschen added: ‘Something has to change as London has always been at the forefront of global food, lifestyle and hospitality trends. At present Europe has the whole cake and eats it too.

‘The reinstatement of VAT-free shopping for tourists would be a very positive start.’

He told the Mail: ‘We are joining our counterparts from across all sectors of UK business, from retail to hospitality to the arts, in calling for the Government to reinstate tax-free shopping for tourists, in order to allow us to compete on a level playing field to the rest of Europe and to keep our economy robust.’

Bob van den Oord, managing director of luxury hotel The Langham London, said the removal of tax-free shopping ‘has turned out to be a huge own goal for the UK economy’.

‘Traditionally, one of the things our guests have come here to do has been to take advantage of our brilliant shopping districts. Now they know they can buy the same goods anywhere in the EU for 20 per cent less,’ he said.

Other signatories include Mulberry, Kurt Geiger and Burberry, department stores Harvey Nichols and Fortnum & Mason and jewellers Boodles, Garrard and Wartski.

The campaign is also backed by the bosses of 20 airports and hotels such as Claridge’s and The Savoy.

New signatories include fashion brand Jenny Packham, the Association of Leading Visitor Attractions, Longchamp and Mamas & Papas.

Nigel Keal, chairman of the UK Travel Retail Forum, which represents most sectors of the travel retail business, told the Mail: ‘Our international competitors are now reaping the rewards of the travel rebound, while the UK faces the prospect of becoming globally uncompetitive, and unattractive to high-spending tourists.’ Several Tory former Cabinet ministers – including ex-chancellor Sajid Javid, and former business secretaries Dame Andrea Leadsom and Jacob Rees-Mogg – have also voiced their support.

But despite the pleas reaching Rishi Sunak, he remains adamant that the tax cut is not a priority.

The Prime Minister told the Mail this week it would cost £2billion and benefit only a ‘very small group of very wealthy travellers who are coming predominantly to just central London’.

Research suggests, however, that tax-free shopping would bring a much-needed £4.1billion boost to GDP and support 78,000 jobs, according to Oxford Economics.

And experts estimate there would be a net gain of around £350million-a-year because of the knock-on benefits of tourists spending across the country and the economy.

This year, Mulberry closed its Bond Street store as a result of the loss of tax-free shopping.

Research also suggests the UK’s pandemic recovery is being hampered by the loss of the scheme. The UK is at 64 per cent of 2019 consumer spending levels, while France is at 108 per cent, according to data from Global Blue.

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