Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the behavioural changes of travellers as a result of the withdrawal of tax-free shopping for international visitors.

The Government’s assessment of the anticipated behavioural changes as a result of tax-free shopping (covering the VAT Retail Export Scheme and the airside scheme) was set out in the original policy costing note which can be found in the Policy costings document from November 2020 p42-43. The government followed the same methodology when calculating costings for the 2022 Growth Plan, which can be found in the Growth Plan documents paragraph 4.19 and Table 4.2 from September 2022.

Whilst there are no current plans to re-introduce tax-free shopping for international visitors, the government keeps all tax policy under review, and we are very grateful to industry for their contribution to our invitation to provide evidence on this matter.