BUSINESS leaders in Scotland are calling on the UK Government to reverse its “devastating decision” to scrap VAT free shopping for overseas visitors.
The Scottish Chambers of Commerce and the Scottish Retail Consortium have written to the Chancellor today calling on the Treasury to preserve the duty-free VAT Retail Export Scheme for international tourists from the beginning of next year.
The SNP has also warned the move to abolish the perk would deliver an “economic body blow” to the tourism sector and Scotland’s airports and businesses.
Scotland’s two biggest airports, Edinburgh and Glasgow, generate around £10 million a year in sales directly at the airports and in the local and national retail sector. Across the UK, over £3bn in tax-free sales are made to non-EU tourists each year. Business leaders say scrapping the tax relief could put thousands of jobs at risk.
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Despite the UK Government’s own consultation on the issue showing almost unanimous support for the continued operation of the scheme and the airside extra-statutory concession scheme, Treasury ministers are ploughing ahead with plans to scrap the schemes in just a matter of weeks.
The SNP’s shadow transport secretary Gavin Newlands MP said it was time for Westminster to “see sense” over the issue.
“Our retail and aviation sectors need all the support they can get in the midst of this global pandemic, but the Treasury’s actions to scrap crucial tourist VAT free schemes will do nothing less than pull support in their moment of need,” he said.
“Both the VAT Retail Export Scheme and the airside extra-statutory concession scheme play a critical role in helping the tourism sector, creating jobs, and helping businesses thrive. In these challenging circumstances, the UK Government’s intention to scrap the schemes will only deliver an economic body blow to already struggling industries and result in entirely avoidable job losses.”
He pointed out that with the furlough scheme coming to an end, the threat to jobs had grown.
“It is critical that the UK Government strengthens support rather than scrapping it, and works with industry organisations to ensure its survival,” said Newlands.
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