UK Considers Reinstating Tax-Free Shopping for Tourists

The UK government is contemplating the reinstatement of tax-free shopping for tourists, a privilege that was abolished in 2020. The potential impact of scrapping the tourist tax could lead to earning an additional £5 billion a year from EU visitors. The Office for Budget Responsibility (OBR) has been assigned the task of reviewing the financial ramifications of the 2020 decision. The potential reinstatement of tax-free shopping has been met with considerable anticipation from the retail sector, with industry leaders and Conservative MPs pressurizing the government to abandon the controversial ‘tourist tax’. The Treasury has estimated that restoring VAT-free shopping will cost the exchequer £2 billion.