UK Government Must Reverse Damaging Decision on Tourist Tax

Pressure is building on the UK government to see sense and urgently reverse the damaging decision to scrap VAT-free shopping for overseas visitors – a move which the SNP has warned would deliver an “economic body blow” to the tourism sector and Scotland’s airports and businesses.

The call comes after business leaders, including the Scottish Chambers of Commerce and the Scottish Retail Consortium, wrote to the Chancellor today (Sunday) calling on the Treasury to reverse its decision to abolish the duty-free VAT Retail Export Scheme for international tourists from the beginning of next year.

Scotland’s two biggest airports, Edinburgh and Glasgow, generate around £10 million a year in sales, directly at the airports and in the local and national retail sector.

And over £3bn in tax-free sales are made to non-EU tourists each year across the UK.

Despite the UK government’s very own consultation on the issue showing almost unanimous support for the continued operation of the VAT Retail Export Scheme and the airside extra-statutory concession scheme, Treasury ministers are ploughing ahead with plans to scrap the schemes in just a matter of weeks.

Commenting, the SNP’s Shadow Transport Secretary Gavin Newlands MP (pictured) said:

“Our retail and aviation sectors need all the support they can get in the midst of this global pandemic, but the Treasury’s actions to scrap crucial tourist VAT-free schemes will do nothing less than pull support in their moment of need.

“Both the VAT Retail Export Scheme and the airside extra-statutory concession scheme play a critical role in helping the tourism sector, creating jobs, and helping businesses thrive.

“In these challenging circumstances, the UK government’s intention to scrap the schemes will only deliver an economic body blow to already struggling industries and result in entirely avoidable job losses.

“With the furlough scheme coming to a premature end yesterday, the threat to jobs has grown.

“It is critical that the UK government strengthens support rather than scrapping it, and works with industry organisations to ensure its survival.

“Even at this late stage there is still time for the UK government to see sense and maintain these crucial schemes to protect thousands of jobs from being lost and to prevent businesses from going under for good.”