UK shoppers are increasingly engaged in tax-free shopping within the EU, with a reported 16% increase in spending in 2024 as compared to 2023. This rise in tax-free purchases follows the introduction of the EU's VAT rebate scheme for British travelers after Brexit. In 2023, UK consumers spent £742 million, a significant increase from £527 million in 2022. Analysts believe the financial benefits of shopping in the EU outweigh travel costs. Reinstating the UK's VAT-free scheme for overseas visitors is under discussion due to the economic impacts currently felt by domestic retailers.
British consumers are increasingly turning to tax-free shopping trips in Europe, with spending in the EU up 16% so far this year compared to 2024, according to new data from the Association of International Retail (AIR).
AIR chairman Derrick Hardman said the trend shows 'a new market in shopping-led tourism has emerged', adding: 'It's sad to see British shoppers taking their business elsewhere.'
Campaigners argue the decision costs the UK around two million international visitors a year and deters spending in British stores, particularly on luxury brands.
AIR estimates that reinstating VAT rebates for EU visitors alone could add £3.65 billion to the UK economy annually, generating more than £500 million in additional VAT revenue for the Treasury.
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