The Scottish Government has expressed concerns over the cancellation of a scheme allowing tourists to claim back VAT on shopping done while in the UK.
Finance Secretary Kate Forbes MSP claims that the Scottish Government was not consulted before an announcement that the VAT Retail Export Scheme would be cancelled after the end of the Brexit transition period on 31 December.
The scheme allows non-EU nationals to claim back VAT paid on goods they take home in their personal luggage.
The UK Government said the scheme only benefited areas with high numbers of tourists, but retail groups have called for it to continue.
In response to a written question from Scottish Labour deputy leader Jackie Baillie MSP, the Finance Secretary said: “This change was announced suddenly by the UK Government and, despite the obvious and substantial implications for the Scottish retail and tourism sectors, without prior engagement with Scottish Government officials.
“Accordingly, we have had no opportunity to carry out analysis of our own and none has been shared by the UK Government.
“Since this announcement, the Scottish Government has received representations from a number of stakeholder organisations expressing concerns about the impact on trade and the wider economy.
“We share their concerns and do not believe that this is an appropriate juncture at which to make such an abrupt and significant change.”
Scottish Retail Consortium director David Lonsdale shared the concerns concerns over the cancellation of the scheme.
He said: “The UK Government needs to reconsider its decision to scrap the VAT Retail Export Scheme.
“That scheme encourages high street spending from international tourists visiting Scotland and the rest of the UK.
Lonsdale said the move was “astonishing” given the recent downturn in retail sales because of the coronavirus pandemic.
He added: “The decision could cost Edinburgh city centre, for example, many millions in lost retail sales, let alone the knock-on impact on tourism.
“This decision would leave the UK as the only European country not to provide a tax-free shopping scheme to encourage tourism. There is a good reason no other European nation has taken this step, and we urge swift reconsideration.”
Scottish Government, Tourism, Scotland, Kate Forbes
Actu monde – GB – Retail sector and Scottish Government raise concerns over ending of tourists claiming back VAT