// Britain is set to reintroduce sales tax-free shopping for international tourists to boost the country’s retail sector, says Chancellor Kwasi Kwarteng
// A consultation will “gather views on the approach and design of the scheme” before it is delivered as soon as possible
Retailers have welcomed the proposed return of VAT-free shopping for international tourists by Chancellor Kwasi Kwarteng, saying it would help boost the country’s retail sector.
Kwarteng revealed in his new Growth Plan that the government would consult on introducing a new tax-free shopping scheme for the UK and would modernise the one in place in Northern Ireland.
The scheme will allow tourists to get a refund on VAT on goods bought on the high street, at airports and other departure points and exported from the UK in their personal baggage.
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“Britain welcomes millions of tourists every year, and I want our high streets and airports, our ports and our shopping centres, to feel the economic benefit. So we have decided to introduce VAT-free shopping for overseas visitors,” he told parliament during the presentation of a mini-budget.
A previous tax-free shopping was abolished at the end of 2020 by the former Chancellor Rishi Sunak post-Brexit. Kwarteng said the government would replace the previous paper-based system with a digital one. “And this will be in place as soon as possible.”
KPMG‘s UK head of consumer markets, retail and leisure Linda Ellett said the move would increase the UK’s competitiveness when it comes to attracting international visitors.
“This is all the more key as we look to find ways to create economic growth, return international tourism to pre-pandemic volumes, and withstand rising inflation on the high street,” she said.