Harrods managing director Michael Ward has called on the UK government to “stop burying its head” and bring back VAT-free shopping for overseas shoppers.
“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,” Ward told The Times.
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This comes as tourists visiting the UK were allowed to reclaim VAT on purchases until January 2021, when the tax break was scrapped by then Chancellor Rishi Sunak.
However, despite Kwasi Kwarteng attempting to reintroduce the scheme in his mini-budget last year, Jeremy Hunt reversed the decision a month later.
In response to trade minister Nigel Huddleston asking businesses for more “data and information” on how the scrapping of the VAT refund scheme is hurting the economy, the boss of the luxury retailer hit back claiming retailers have already done that citing the independent report by Oxford Economics.
The report, commissioned by the Association of International Retail, revealed the VAT u-turn would benefit the economy by around £350 million a year rather, than costing the country £2 billion.
He said: “Asking us for more figures when we’ve employed an external consultant is a bit, ‘haven’t really read my papers’. What we ask is that the Office for Budget Responsibility review that document and see whether our conclusions are correct. If they are, then they should reinstate tax-free shopping.”
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