// Harrods boss Michael Ward calls on the UK government to reintroduce tax-free shopping
// “We’re in the middle of a difficult time for the UK economy and the government should be seizing opportunities to grow.”
Harrods managing director has urged the UK government to “stop burying its head” and u-turn its removal of VAT-free shopping for overseas customers.
The luxury department store‘s Michael Ward told The Times: “We’re in the middle of a difficult time for the UK economy and the government should be seizing opportunities to grow. I think it might be time for them to wake up and smell the coffee.”
The government has been facing fresh calls from a host of organisations, including VisitBritain and the luxury trade body Walpole which counts Burberry, Harrods and Mulberry as members, to restore tax-free shopping for overseas tourists amid fears London is losing out to rivals Milan and Paris.
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Tourists visiting Britain were allowed to reclaim VAT on purchases until January 2021, when the tax break was axed by then chancellor Rishi Sunak.
His successor Kwasi Kwarteng tried to reintroduce the incentive in his ‘mini-Budget’ but current chancellor Jeremy Hunt reversed the decision a month later.
The Treasury claims it will save £2bn a year – a figure disputed by some economists who think it will actually hit the public purse.
Due to the impact of the legislation, Mulberry closed the doors to its Bond Street store this year.
A spokesman from the luxury fashion retailer said at the time: “The lack of VAT-free shopping in the UK has been particularly felt on Bond Street, which has always been an iconic shopping destination for tourists. The decline in visitors has impacted footfall and sales.”
According to Walpole chief executive Helen Brocklebank, if a next-generation tax-free shopping scheme could be introduced, London’s status as the world’s number-one luxury city would be guaranteed.
Last year, Ward backed calls for a review of the tax joining the likes of Selfridges while Kurt Geiger boss Neil Clifford also criticised the UK for scrapping VAT-free shopping for international tourists, saying he was “immensely disappointed” with the decision.
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