Measure

VAT Retail Export Scheme

The measure

The government has announced that further to various industry submissions on the VAT Retail Export Scheme and the associated airside scheme (tax-free shopping) it will continue to accept representations and consider this new information carefully, alongside broader data. 

 

Who will be affected?

Retailers, typically high-end retailers in the fashion and the household goods sector, who have traditionally supplied goods to non-UK resident purchasers. 

 

When will the measure come into effect?

This matter will be monitored by the government. 

Our view

The “Tourist Tax”, which effectively means that non-UK resident purchasers of goods on high streets in Great Britain can no longer benefit from VAT-free shopping given the withdrawal of the VAT Retail Export Scheme from 1 January 2021, has been a topical issue in recent years. This measure indicates that whilst there are no immediate plans to reinstate the scheme given concerns about its cost and how it would operate in a post-Brexit environment, the government will continue to monitor developments.