This post was originally published on this site.
Burberry has urged Prime Minister in waiting Andy Burnham to reinstate tax-free shopping for overseas visitors, arguing the move would help revive luxury retail spending and strengthen the UK’s fashion industry, including Burberry’s northern manufacturing facilities.
According to The Telegraph, Burberry CEO Joshua Schulman said the luxury brand’s tourist business has fallen by around 50% since 2019, which he attributed largely to the abolition of the VAT Retail Export Scheme in 2020.
The scheme previously allowed international visitors to reclaim VAT on purchases made in the UK before it was scrapped by the Conservative government.
Speaking to The Telegraph, Schulman said: “Our tourist business has gone down by 50% since 2019 and that is largely a consequence of the VAT refund scheme.”
“We hope to see policies that enable competitiveness and make it more enticing for tourists to come to the UK and spend time in this beautiful country, and of course shop here.”
Joshua Schulman, CEO at Burberry
He also highlighted Burberry’s contribution to the UK economy beyond its London retail presence, pointing to the brand’s manufacturing operations in Yorkshire and office in Leeds.
“We also have a strong manufacturing presence in Yorkshire and we have a back office facility in Leeds. We are present throughout the country,” Schulman told The Telegraph, adding that Burberry was “the only luxury brand of scale to have Britishness at our core”.
The comments come as Burberry continues its turnaround under Schulman’s leadership. In its latest trading update, the luxury house reported retail revenue of £455 million, with sales supported by a 12% increase in the Americas, and improved demand for core categories including outerwear and leather goods.
Schulman’s remarks also reignite debate over tax-free shopping, with retailers and industry bodies continuing to campaign for the return of the VAT refund scheme. They argue that overseas visitors are increasingly choosing to shop in destinations such as France and Italy, where tax-free purchases remain available.
Last year, New West End Company estimated the removal of tax-free shopping resulted in £400 million of unrealised retail sales across London’s West End in 2023 alone, despite international visitor numbers recovering. The organisation has continued to call for the policy’s reinstatement, arguing it would boost retail, tourism and hospitality while improving the UK’s competitiveness as a global shopping destination.
Incoming Prime Minister Burnham has also pledged to reform the business rates system, which currently places an unfair burden on retailers given their high street locations.