A popular tax cut expires in the UK in January, threatening the UK’s position as a shopping destination and potentially hitting struggling retailers in another way.
According to The Wall Street Journal, the system allows foreign visitors to refund 20% sales tax on goods purchased domestically for £ 30 or more, or about $ 40. This can be summed up, especially for foreign tourists who drop serious coins into expensive stores (already seen retail outflows) and top-notch shopping districts on London’s high streets.
The tax deduction will expire after the UK officially withdraws from the European Union Customs Union and the European Single Market on 31 December.
UK business owners are worried that shoppers may stop coming to the UK in favor of other European destinations with similar tax systems, such as Paris and Milan. Visitors from outside the European Union can claim 20% of their spending in France and 22% of their spending in Italy.
A recent survey of tourists found that at least 70% of visitors from Asia and the Middle East and 70% of Americans are unlikely to visit the UK after the tax cut has expired.
The coronavirus pandemic is also putting pressure on UK retailers. Over 7,800 retail stores closed in the first half of the year.
Heathrow Airport owners are leading a legal challenge against the abolition of tax refunds, and in the UK High Court, the government failed to consult with the parties most affected by the change and financed the abolition Claims to have miscalculated the details. [WSJ] — Denis Lynch
UK Could Lose Foreign Shoppers As Tax Break Expires Source link UK Could Lose Foreign Shoppers As Tax Break Expires