VAT Retail Export Scheme
Debate between Baroness Penn and Lord Davies of Gower
Baroness Penn (Con)
My Lords, the option to keep the current scheme in place does not exist. Either we need to extend it to EU visitors, which will attract a significant cost, or we need to end it. We have taken the decision to do the former. As I said, our understanding of the research is that visitors to the UK are driven by a wide range of factors, this not being the primary one. As I said in response to my noble friend’s Question, the OBR will conduct an independent analysis of the Government’s work on this policy.
Lord Davies of Gower (Con)
I will follow the theme of the supplementary question from my noble friend Lord Vaizey. With the withdrawal of the scheme in January 2021 and the proposal that EU visitors be able to buy UK VAT-free goods from retailers only where the retailer arranges transport for the goods from the UK as an export, does the Minister agree that this potentially reduces footfall and places an additional burden on retailers, particularly high-street traders, when most are struggling to survive? Does she also agree that, given the present circumstances, the Government should perhaps think again in order to help small and large retailers?
Baroness Penn (Con)
My Lords, our understanding is that the benefit from the VAT RES flows almost entirely to two places: central London and Bicester Village. High streets across the country need our support during the pandemic. That is why we have the future high streets fund of £675 million, and the towns fund, supporting 100 towns with £3.6 billion of funding.