Budget plea for return of tax-free buying after vacationer numbers plunge
Calls to bring back tax-free shopping were growing last night as analysis revealed inbound tourist numbers have plummeted.
Travel bosses told Chancellor Rachel Reeves to scrap the hated ‘tourist tax’ in this month’s Budget if she is serious about boosting economic growth after visitor spending also nosedived.
The study found inbound tourist visits to Britain fell by nearly 15 per cent to 16.5million in the first six months of this year, down from 19.1million during the same period in 2024. The sharp drop also saw overall spending by foreigners drop from £14.4billion to £12.6billion.
If the trend continues, it would mean spending in the UK economy by tourists being £5.7billion lower this year than in 2024.
Separate studies have suggested that reinstating tax-free shopping could support 200,000 jobs and add up to 0.4 per cent to Gross Domestic Product by the end of the decade, equal to £10.8billion.
The Daily Mail has been campaigning for the return of tax-free shopping. And critics said the latest study was proof that the failure to restore it was damaging the economy, with tourists apparently choosing other European countries which have the perk.
Former BA boss Willie Walsh, now chief of industry body the International Air Transport Association, said: ‘If Keir Starmer and Rachel Reeves are serious about Britain’s global aspirations, then they must rethink their strategy.
People don’t come to Britain for the weather! The UK has to be a cost-competitive international destination if it’s to attract more visitors.’
Travel bosses told Chancellor Rachel Reeves to scrap the hated ‘tourist tax’ in this month’s Budget if she is serious about boosting economic growth after visitor spending also nosedived
Karen Dee, chief executive of trade body AirportsUK, said: ‘The Chancellor should use the upcoming Budget to reverse this policy to ensure the UK remains an attractive place for foreign visitors to come and spend their money.’
The analysis, based on data from the Office for National Statistics, found the biggest drop in spending was by visitors from ‘other countries’ outside Europe and North America.
This includes the Middle East and Far East, where many wealthy tourists often flock from to London and buy luxury goods.
The Treasury has claimed scrapping the tourist tax would cost the public purse £2billion a year.
