Letter to minister

Demand for rethink on tax-free shopping ban

David Lonsdale

David Lonsdale of the SRC is among those calling for a change of decision

Six Scottish business organisations have stepped up the campaign to allow international visitors to benefit from tax-free shopping.

They have written jointly to the Scotland Secretary Alister Jack, urging a rethink of plans to end the VAT Retail Export Scheme on 1 January.

They say it will deliver a further blow to hard-pressed high streets as visitors to Scotland from international destinations, particularly China and the United States, make a valuable contribution to the economy.

Business groups including the Scottish Retail Consortium, SCDI and the Chambers have already made representations to the UK government. MSPs from all parties are offering their support.

A motion has been lodged with the Holyrood parliament by Labour’s Daniel Johnson calling for cross-party unity on the issue. Finance Secretary Kate Forbes has pledged the government’s support.

The six business group say tax free shopping and visits by international visitors generates much needed jobs and revenues in the retail, tourism, hospitality and leisure sectors, already struggling with the impact of Covid-19.

The text of the letter is as follows:            

Dear Secretary of State,

We are writing to express our alarm at the UK Government’s abrupt decision to end the VAT Retail Export Scheme (commonly known as Tax Free Shopping) for international visitors to Scotland on 1 January 2021.

We are similarly concerned at the withdrawal of the airside tax-free concession on the sale of non-excise goods at ports and airports.

Visitors to Scotland from the USA, China and other international destinations make a valuable contribution to our economy including through the purchase of goods and through holidaying here.

This tax free shopping and visits by international visitors generates much needed jobs and revenues in the retail, tourism, hospitality and leisure sectors in Scotland, and which will be even more important as these industries seek to recover over the next couple of years from the distress of the Covid-induced recession.

Furthermore, we understand the UK will be the only country in Europe not to operate a tax free shopping scheme to aid tourism if it ends. There is good reason no other European nation has taken this self-inflicted step, and so we ask that you and UK Ministers rethink this decision or at least postpone it until a more rounded assessment is undertaken and discussions are held with industry on possible alternative solutions.

Yours sincerely,

Roddy Smith, Chief Executive, Essential Edinburgh
Liz Cameron OBE, Chief Executive, Scottish Chambers of Commerce
Sara Thiam, Chief Executive, Scottish Council for Development & Industry (SCDI)
David Lonsdale, Director, Scottish Retail Consortium
Marc Crothall, Chief Executive, Scottish Tourism Alliance
Willie Macleod, Executive Director – Scotland, UKHospitality

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