Retailers Expect Increase in Tourist Relaxation from Covid

On August 2, the first passengers began arriving in the UK after the rules changed to allow fully vaccinated people in the US and the European Union to avoid quarantine. The change, which came at 4 a.m., affects those arriving from countries on the UK’s orange list – with the exception of France.

Fashion retailers predict “increased tourism to UK”.

“This is great news for our business as it will definitely increase sales,” said the owner of an independent womenswear based in east London. “We’ve been running out of tourists in our store. We’ve already seen a number of American tourists visit the store, so over the summer hopefully people will make an effort to visit London and spend.”

Simon Cundey, managing director and owner of Savile Row-based tailor Henry Poole, said: “It’s really needed in the UK, especially in cities that rely so heavily on tourism and events. We have already had clients making appointments and booking to fly over from the end of August. Thanks to flexi-leave [when employees are on furlough part-time and work the remaining days] we have gradually brought in staff which has helped us prepare for any increase in orders over the summer months.

However, Cundey said the lack of a 20% VAT refund for tourists, which ended on December 31, could deter international tourists from splurging at tourist hotspots at a crucial time: “La VAT is always a shock to tourists. Many still don’t know. When visiting tourists, we had to explain to them that the program was over, which can be very disappointing. They may be less inclined to spend as much as they would [if VAT-free shopping was still implemented]. “

Simon Carter believes removal of VAT refund system could affect sales

Simon Carter, owner of the eponymous men’s clothing brand, agreed that ending the quarantine for vaccinated tourists from the EU and US will help boost sales at his six London stores, but the lack of VAT-free purchases could hamper any increase: “It is still a conundrum as to why the government abolished VAT-free purchases at a time when businesses need it so badly. This won’t deter all visitors to London, but some might choose to travel elsewhere in Europe, if it means they can benefit from duty-free shopping. “

Likewise, the owner of an independent menswear store in London said: “Over the past few weeks there has been an infiltration of foreign visitors into London, and with the quarantine coming to an end I expect. that this number gradually increases. However, it was absolutely absurd to get rid of tax buying at a time when businesses are trying to recover from the past eighteen months. “

Meanwhile, Emily Salter, senior clothing analyst at GlobalData, told Drapers: “There will be an increase in tourism to the UK, but many consumers will still be cautious about visiting the UK and others. country, due to the prevalence of the delta. variant.

“However, tourists visiting the UK will have more disposable income to spend than usual due to government stimulus checks in the US and increased savings during closures, although all of this does not. is not retailed, as tourists will be eager to devote to other activities such as experiences and dining out.

“The end of the VAT exemption on tourism will have an impact on retail spending, but as most tourists are likely to save money and will not have been to the UK for some time , this will have less of an impact than in the future, as many are keen to buy from iconic UK brands and retailers ranging from Liberty and Selfridges to Primark.

“London will benefit the most from the increase in tourism, but many tourists might be shocked at the number of empty stores in shopping destinations such as Oxford Street, so retailers need to make sure their stores are attractive to counter. that.”

A spokeswoman for the Treasury said: ‘Visitors to the EU have never been able to use the VAT retail export scheme and around 92% of non-EU visitors to the UK have not used it .

However, duty-free purchases are still available in-store when goods are shipped to addresses overseas.

“We fully recognize the current challenges facing the retail and aviation sectors, which is why we will continue to support them through our £ 352 billion economic support program – including a leave, tax deferrals, government guaranteed loans and grants. ”

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