MPs from all parties call for tourist tax to be axed as Liz Truss and Sadiq Khan claim the fee puts Britain at a ‘competitive disadvantage’ with rest of Europe
- Liz Truss led a growing clamour of calls from MPs demanding tax-free shopping
- Lib Dem leader Sir Ed Davey said it would ‘turbo-charge Britain’s high streets’
- READ – DAILY MAIL COMMENT: Scrap the tourist tax that’s harming Britain
A cross-party group of politicians joined forces tonight to back the Mail’s campaign to bring back tax-free shopping for tourists.
Former prime minister Liz Truss led a growing clamour of calls from MPs demanding ministers restore the VAT refund for visitors to boost economic growth.
She was joined by Labour’s London Mayor Sadiq Khan and Liberal Democrat leader Sir Ed Davey, who said it would ‘turbo-charge Britain’s high streets’.
Yesterday the Mail launched its Scrap The Tourist Tax campaign in support of firms urging the Government to think again.
A coalition of retail, hospitality and tourism bosses – brought together by hotelier Sir Rocco Forte – wrote to Chancellor Jeremy Hunt to say that reinstating tax-free shopping would benefit both business and the taxpayer. They argued that the cost of 20 per cent VAT refunds outweighs the benefits of encouraging more visitors to Britain.
Former prime minister Liz Truss (pictured) led a growing clamour of calls from MPs demanding ministers restore the VAT refund for visitors to boost economic growth
Miss Truss was joined by Labour’s London Mayor Sadiq Khan and Liberal Democrat leader Sir Ed Davey, who said it would ‘turbo-charge Britain’s high streets’
Miss Truss, who sought to bring back tax-free shopping during her brief tenure in No 10, only for it to be reversed by Mr Hunt, gave her ‘full support’ to the campaign. She said: ‘Overall revenue to Treasury coffers would rise as a result of attracting more tourists to the UK, spending their cash.
READ MORE: Time to scrap the ‘Tourist Tax’ and get Britain booming again: Business leaders call on Chancellor to reinstate tax-free shopping for overseas visitors – as research shows scheme would bring £4.1BILLION to UK’s economy
‘Yet again static Treasury modelling is causing the Government to adopt policies which damage economic growth.
‘At a time when we are particularly keen to attract foreign tourists after the difficult period of the pandemic, failing to offer tax-free shopping is putting Britain at a distinct competitive disadvantage by making European cities like Paris, Madrid and Milan more attractive to visitors from around the globe. The Daily Mail campaign has my full support.’
Mr Khan said reintroducing tax-free shopping for visitors would provide a vital ‘shot in the arm’ for tourism in the capital. It would also boost retail and hospitality sectors, as well as the wider UK economy, he said.
‘It would be a simple way to attract international tourists back to London – many of whom go on to visit other parts of the country, raising hundreds of millions of pounds for the Treasury,’ he said.
‘We need to do everything we can to make London and the UK as competitive as possible for international tourism.’ Despite Mr Khan’s backing, the Labour Party refused to support the campaign.
But Sir Ed, a former business minister, gave his ‘full support’ to the Mail’s campaign.
‘It is an excellent idea to turbo-charge Britain’s high streets and give business owners a major boost in difficult economic times. This is just good economic common sense,’ he said.
The Mail has launched its Scrap The Tourist Tax campaign in support of firms urging the Government to think again
Miss Truss said that ‘failing to offer tax-free shopping is putting Britain at a distinct competitive disadvantage by making European cities like Paris, Madrid and Milan more attractive to visitors from around the globe’. Pictured: Shoppers on Oxford Street
And a host of senior backbenchers urged the Government to reintroduce tax-free shopping for tourists.
JEREMY HUNT: Rates are too high
The Chancellor has admitted the tax burden is too high.
In his Budget Jeremy Hunt refused to cancel this month’s hike in corporation tax from 19 to 25 per cent. But he told the Business Connect summit yesterday: ‘The tax burden is too high… the way we will bring the tax burden down is by growth.’
He also argued Britain already had ‘around’ the second most competitive business tax rate in the G7, behind the US.
Tory grandee Sir John Redwood said: ‘This country has got to earn its living: we need to attract people here with money to spend.
‘Come, spend, pay tax – but don’t tax them away from us. They are taxing the businesses away, and they are taxing the shoppers away.’
Sir John, who headed Margaret Thatcher’s policy unit, said welcoming tourists to Britain will ‘create jobs and activity, and they will end up paying more tax’.
He said it was ‘one of many’ post-Brexit freedoms that the Government should utilise.
Conservative MP Henry Smith, chairman of the all-party parliamentary group on the Future of Aviation, said scrapping the tax would bring benefits to the whole of Britain’s economy.
He said bringing back tax-free shopping for tourists was ‘very important for our retail economy, and that’s obviously very important not just for London and the South East – but the whole of the United Kingdom’.
Mr Smith added: ‘There is evidence to suggest that we are missing out in terms of visitor numbers to this country, and visitors deciding perhaps to spend a few extra days in Paris or Rome rather than London because the tax advantages aren’t as generous here.’
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