Burberry’s Chairman, Gerry Murphy, has strongly criticized the UK government for its decision to cancel VAT-free shopping for tourists in Britain, deeming it a detrimental move for both shoppers and businesses in the post-Brexit era. Former Chancellor of the Exchequer Rishi Sunak’s choice was referred to by Murphy as a “spectacular own goal,” which has resulted in a decline in visitor numbers and had a negative impact on various industries.
Speaking at the Business Connect conference, Murphy condemned the lack of VAT refunds for high-spending tourist shoppers, claiming that it has left Britain as the least attractive shopping destination in Europe. He stressed that the consequences of this rule change extend beyond the luxury sector, affecting the travel industry as well. Murphy criticized the decision as “somewhat perverse” and pointed out the repercussions of the country’s exit from the European Union on trade.
Despite Murphy’s vocal disappointment, he had the opportunity to voice his concerns directly to Prime Minister Sunak at a business event. Although Sunak defended the decision, he assured attendees that the government would thoroughly review the data surrounding the issue. This acknowledgment provided a glimmer of hope for those hoping for a reversal of the VAT policy.
The pressure on the UK government to reconsider VAT-free shopping continues to grow, with influential figures like Murphy expressing their discontent. The impact on the country’s appeal as a shopping destination, combined with potential harm to the luxury and travel sectors, are significant concerns that cannot be easily disregarded. The government will face mounting expectations to address this issue and take action accordingly.
Useful links:
1. Government Publications – VAT Refund for Non-EU Businesses
2. BBC News – UK Retailers Urge VAT Reforms
