As the Chancellor failed to reinstate exempt from taxes buying for international spenders in the Spring Budget, his backing of style and retail was largely disregarded. Recent results appear to confirm opponents’ suspicions. New data reveals that despite a 17% increase in bookings for flights from the US, US tourists are choosing European cities over the UK as their shopping destination. US tourist spending in the West End of London has dropped by 1%, but it has soared to 183 percent in France and 174 percent in Portugal over the same period. The similar pattern applies to Gulf visitors. Similar research has indicated that the UK loses £10.7 billion in GDP due to tax-free shopping every year and loses two million tourists as a result.
According to The New West End Company CEO Dee Corsi said that the numbers “should establish the alarms ringing in Westminster,” and Jigsaw CEO Beth Butterwick said that Britain is now the “black sheep” of Europe, in London trailing other opulent hotspots like Paris, Madrid, and Milan. Rasmus Brix, the head of Pandora UK, reaffirmed that eliminating the tax on tourists and allowing foreign customers to receive a 20% rebate on what they buy would aid in easing the burden that the cost of living crises, gloomy weather, and train strikes are continuing to have on already struggling high streets. Walpole, a British luxury organization, is also asking its members to keep up the advocacy for this issue.
Harrods’ profits had nearly tripled, while its revenues rose up 52 percent to £994 million in the twelve months ending in January 2023. It’s interesting to note that the Knightsbridge store partly credited its growth in sales to the influx of returning foreign consumers during the epidemic, as well as to its ‘longstanding ties with both companies and loyal customers’. Although Harrods has outpaced its competitors, as a famous retail establishment with a long history, it might be an exception.