// The Treasury Committee has asked for evidence behind Chancellor’s decision to scrap duty free shopping
// Chairman Mel Stride has written to the Chancellor asking for the cost analysis of the VAT overhaul
The Treasury Committee has demanded to see evidence behind Chancellor Rishi Sunak’s decision to scrap duty free shopping for overseas visitors.
Chairman Mel Stride has written to the Chancellor asking for the cost analysis of the VAT overhaul.
An evidence session this week raised concerns about the clarity of the consultation process, as well as calls from retailers to reconsider the move.
Stride said MPs on the committee have been warned that the move could affect many retailers in the already-struggling tourism sector:
“It could be seen as the UK imposing a tariff on its own exports,” Stride said.
“An announcement of this nature would usually be made at a fiscal event and would be published with the accompanying costings.”
The move will stop overseas visitors from reclaiming VAT on luxury purchases in the UK.
Buyers can apply for a refund in airports before departure, but once the rules change next year this will no longer be possible.
The Treasury said visitors could instead recoup the tax by posting the products home directly from shopping centres.
The overhaul is part of Number 11’s plan to bring the tax relief in line with other systems post-Brexit.