Retailers fear wealthy foreign shoppers are abandoning London because of the so-called 'tourist tax' (Image: Future Publishing via Getty)
SUBSCRIBE Invalid email
We use your sign-up to provide content in ways you've consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. Read our Privacy Policy
SHOPPING beneath the Christmas lights is one of central London’s great attractions – a picturesque bustle that’s great for British business. For my business, Richard James, and other UK retailers, it’s our busiest period and accounts for a large chunk of our annual income. But we’re losing out, as high-end international shoppers desert London and head to Paris, Milan and other European cities.
All because of what retailers have mockingly dubbed a “tourist tax” – namely, the loss of the tax-free shopping scheme, which until January 2021 allowed international visitors to the UK to claim 20% VAT back on their purchases.
DON'T MISS
Powered by
UK seaside town most famous for giant port to get huge ￡500million boost
8 Comments
Keir Starmer and Rachel Reeves are making one key mistake on economy
70 Comments
Eurozone meltdown as bloc's 'survival at risk' over imploding French government
161 Comments
Rachel Reeves' great escape - how Labour Chancellor could blunder way to Budget win
22 Comments
Five easy ways to make quick cash before Christmas
2 Comments
Labour is killing the economy and it hasn't even got started yet!
1320 Comments
Britain's favourite supermarket revealed in time for Christmas - and it's not Tesco
8 Comments
Best supermarket loyalty schemes named - not Aldi or Lidl
1 Comments
‘Nightmare before Christmas as 'Grinch' Starmer wrecks festive shopping spirit!'
725 Comments
Don't gloat over French collapse - if Labour carries on like this UK will be next
270 Comments
DWP leaves thousands of savers waiting months for their pension cash
Comments
Airport workers reveal 5 hacks you can use to cut costs when flying
Comments
Panic in Ireland as 14,000 extra beds needed for huge amount of tourists
Comments
Key ingredient driving up the cost of Christmas dinner
5 Comments
QVC host Evey Amery victim of ￡100,000 heist by masked thieves
3 Comments
The richest city in mainland Europe just two hours from the UK
Comments
Russia economy in meltdown as shops lock up butter and pensioners on ￡146 a month fume
32 Comments
Higher prices, lower wages and mortgage rates up: The impact of Labour's shocking Budget
21 Comments
Eurostar branded 'the worst performing' train line in Europe
5 Comments
You may have liked lower inflation and interest rates - Rachel Reeves has other plans
17 Comments
UK seaside town most famous for giant port to get huge ￡500million boost
8 Comments
Keir Starmer and Rachel Reeves are making one key mistake on economy
70 Comments
Eurozone meltdown as bloc's 'survival at risk' over imploding French government
161 Comments
Rachel Reeves' great escape - how Labour Chancellor could blunder way to Budget win
22 Comments
Five easy ways to make quick cash before Christmas
2 Comments
Labour is killing the economy and it hasn't even got started yet!
1320 Comments
Britain's favourite supermarket revealed in time for Christmas - and it's not Tesco
8 Comments
Best supermarket loyalty schemes named - not Aldi or Lidl
1 Comments
‘Nightmare before Christmas as 'Grinch' Starmer wrecks festive shopping spirit!'
725 Comments
Don't gloat over French collapse - if Labour carries on like this UK will be next
270 Comments
DWP leaves thousands of savers waiting months for their pension cash
Comments
Airport workers reveal 5 hacks you can use to cut costs when flying
Comments
Panic in Ireland as 14,000 extra beds needed for huge amount of tourists
Comments
Key ingredient driving up the cost of Christmas dinner
5 Comments
QVC host Evey Amery victim of ￡100,000 heist by masked thieves
3 Comments
The richest city in mainland Europe just two hours from the UK
Comments
Russia economy in meltdown as shops lock up butter and pensioners on ￡146 a month fume
32 Comments
Higher prices, lower wages and mortgage rates up: The impact of Labour's shocking Budget
21 Comments
Eurostar branded 'the worst performing' train line in Europe
5 Comments
You may have liked lower inflation and interest rates - Rachel Reeves has other plans
17 Comments
UK seaside town most famous for giant port to get huge ￡500million boost
8 Comments
Keir Starmer and Rachel Reeves are making one key mistake on economy
70 Comments
Eurozone meltdown as bloc's 'survival at risk' over imploding French government
161 Comments
Rachel Reeves' great escape - how Labour Chancellor could blunder way to Budget win
22 Comments
Five easy ways to make quick cash before Christmas
2 Comments
Labour is killing the economy and it hasn't even got started yet!
1320 Comments
Britain's favourite supermarket revealed in time for Christmas - and it's not Tesco
8 Comments
Axed by then chancellor Rishi Sunak, this measure is different to the idea of charging tourists a nominal sum for each night of their stay and far more pernicious, as it instantly makes shopping in the UK 20% more expensive for foreign visitors.
And it’s not only tourists that are worse off. In October, the Centre for Economics and Business Research found the axing of the tax-free shopping scheme was costing the UK ￡11.7billion in lost revenue by keeping big spenders away from our shores every year, negatively impacting on restaurants, hotels and attractions.
It also means that London’s Bond Street, once the go-to destination in Europe for luxury shopping, has now been overtaken by the Champs-élysées in Paris and the Via Monte Napoleone in Milan. The latter is booming for three reasons: the prestige of to its luxury shops, the strength of the euro against the dollar and, most importantly, because Italy offers tax-free shopping to customers from outside the EU.
The impact of Mr Sunak’s decision was not immediately apparent in 2021 as the country was in the grip of Covid and lockdowns and international visitors were scarce.
But with tourist numbers back to pre-pandemic levels, stores are struggling. The consequences of not giving foreign visitors this 20% refund is clear to most – except Rachel Reeves, a “pro-growth” Chancellor who has just heaped even more misery on the retail sector by hiking employers’ national insurance contributions.
I set up Richard James on Savile Row, the acclaimed centre of British tailoring, in 1992 with a bank loan of ￡10,000.
The business has grown, but we remain a relatively small concern. We make both ready-to-wear and bespoke menswear and we’re the only bespoke Savile Row tailoring house to have won the British Fashion Council’s Menswear Designer of the Year award.
We’ve worked hard to establish a global reputation because international visitors – particularly those from the US and Middle East – have long been the lifeblood of Savile Row. And as a small business, the downturn in international shopping affects us badly.
As we’re a high-end retailer, you might think we should stop snivelling and swallow our losses. But while our prices are undoubtedly high – our two-piece bespoke suits start at ￡6,100 – so too are our costs.
The rent and rates in Savile Row are steep, and the wonderful cloths that we use – many from British mills such as Fox Brothers in Somerset and Dugdale Bros in Lancashire – are far from cheap.
Not to mention our personnel. A Savile Row cloth cutter typically serves a five or six-year apprenticeship and a coat-maker three to five years. Between 50 and 70 hours goes into making one of our bespoke suits. This means that our margins are much tighter than some might imagine. Last week, I spoke to a long-time Savile Row customer from New York. He was here to have two suits made, something he does every year. He’s an Anglophile and loves London. He was very impressed with the luxury hotels and restaurants.
But this year, he explained he was going to Paris instead of Bond Street for the little luxuries he enjoys.
DON'T MISS
Powered by
UK seaside town most famous for giant port to get huge ￡500million boost
8 Comments
Keir Starmer and Rachel Reeves are making one key mistake on economy
70 Comments
Eurozone meltdown as bloc's 'survival at risk' over imploding French government
161 Comments
Rachel Reeves' great escape - how Labour Chancellor could blunder way to Budget win
22 Comments
Five easy ways to make quick cash before Christmas
2 Comments
Labour is killing the economy and it hasn't even got started yet!
1320 Comments
Britain's favourite supermarket revealed in time for Christmas - and it's not Tesco
8 Comments
Best supermarket loyalty schemes named - not Aldi or Lidl
1 Comments
‘Nightmare before Christmas as 'Grinch' Starmer wrecks festive shopping spirit!'
725 Comments
Don't gloat over French collapse - if Labour carries on like this UK will be next
270 Comments
DWP leaves thousands of savers waiting months for their pension cash
Comments
Airport workers reveal 5 hacks you can use to cut costs when flying
Comments
Panic in Ireland as 14,000 extra beds needed for huge amount of tourists
Comments
Key ingredient driving up the cost of Christmas dinner
5 Comments
QVC host Evey Amery victim of ￡100,000 heist by masked thieves
3 Comments
The richest city in mainland Europe just two hours from the UK
Comments
Russia economy in meltdown as shops lock up butter and pensioners on ￡146 a month fume
32 Comments
Higher prices, lower wages and mortgage rates up: The impact of Labour's shocking Budget
21 Comments
Eurostar branded 'the worst performing' train line in Europe
5 Comments
You may have liked lower inflation and interest rates - Rachel Reeves has other plans
17 Comments
UK seaside town most famous for giant port to get huge ￡500million boost
8 Comments
Keir Starmer and Rachel Reeves are making one key mistake on economy
70 Comments
Eurozone meltdown as bloc's 'survival at risk' over imploding French government
161 Comments
Rachel Reeves' great escape - how Labour Chancellor could blunder way to Budget win
22 Comments
Five easy ways to make quick cash before Christmas
2 Comments
Labour is killing the economy and it hasn't even got started yet!
1320 Comments
Britain's favourite supermarket revealed in time for Christmas - and it's not Tesco
8 Comments
Best supermarket loyalty schemes named - not Aldi or Lidl
1 Comments
‘Nightmare before Christmas as 'Grinch' Starmer wrecks festive shopping spirit!'
725 Comments
Don't gloat over French collapse - if Labour carries on like this UK will be next
270 Comments
DWP leaves thousands of savers waiting months for their pension cash
Comments
Airport workers reveal 5 hacks you can use to cut costs when flying
Comments
Panic in Ireland as 14,000 extra beds needed for huge amount of tourists
Comments
Key ingredient driving up the cost of Christmas dinner
5 Comments
QVC host Evey Amery victim of ￡100,000 heist by masked thieves
3 Comments
The richest city in mainland Europe just two hours from the UK
Comments
Russia economy in meltdown as shops lock up butter and pensioners on ￡146 a month fume
32 Comments
Higher prices, lower wages and mortgage rates up: The impact of Labour's shocking Budget
21 Comments
Eurostar branded 'the worst performing' train line in Europe
5 Comments
You may have liked lower inflation and interest rates - Rachel Reeves has other plans
17 Comments
UK seaside town most famous for giant port to get huge ￡500million boost
8 Comments
Keir Starmer and Rachel Reeves are making one key mistake on economy
70 Comments
Eurozone meltdown as bloc's 'survival at risk' over imploding French government
161 Comments
Rachel Reeves' great escape - how Labour Chancellor could blunder way to Budget win
22 Comments
Five easy ways to make quick cash before Christmas
2 Comments
Labour is killing the economy and it hasn't even got started yet!
1320 Comments
Britain's favourite supermarket revealed in time for Christmas - and it's not Tesco
8 Comments
Were he to spend ￡5,000, he said, he would basically save himself ￡1,000 by shopping in France – including the travel. When tourists go elsewhere, they spend less in the UK and more with our competitors.
Of course, the quality of tailoring on Savile Row is second to none, and I’m a great advocate of British style. But the price tag is still the first thing many shoppers look at.
And this Christmas pain is in part a result of the cruel tourist tax. So let our foreign visitors claim back VAT – and let’s get our customers back.
Sean Dixon is the co-founder and MD of Richard James, a Savile Row tailor established in 1992