A letter signed by Liverpool BID Company, Liverpool ONE and Liverpool Airport is calling on Chancellor Jeremy Hunt to reinstate tax-free shopping to boost the city’s economy. Tony McDonough reports
Chancellor Jeremy Hunt is being urged by Liverpool and Cheshire business leaders to reinstate tax-free shopping for visitors from the EU.
Mr Hunt will unveil his Spring Budget to the House of Commons on March 6 and he is being urged to offer the tourism sector an “enormous stimulus” by bringing back the perk that was axed in 2021 following the UK’s withdrawal from the EU.
Analysis by the Financial Times found that there had been a “sharp fall” in spending by visitors to the UK since the policy was scrapped.
Late last week tourist, business and council leaders in Cheshire and Warrington penned an open letter to the Chancellor calling for its reintroduction. It would, they insisted, inject “hundreds of millions of pounds of income” into the region’s economy.
Now their counterparts in Liverpool city region have followed suit with a letter to Mr Hunt signed by Liverpool BID Company, Liverpool John Lennon Airport, Liverpool ONE, Accommodation BID and Liverpool Hospitality.
It said: “The Spring Budget should include the reinstatement of tax-free shopping and its extension to EU visitors.
“This would have a substantial impact on the economy of towns and cities outside of London and, as the 6th most visited city in the UK, would have a major impact on Liverpool.
“…Retail and high-spending tourists are a vital ingredient in Liverpool’s economy. £2.1bn is spent each quarter in Liverpool city region’s economy covering retail, hospitality, food, drink and other services.
“This reaches £734m in the city centre in post-COVID recovery (2021 Visa Online, Visa Merchant and Non Visa spend). Retail and high street spend in Liverpool traditionally outperforms the national average.
“This adds to the wider buoyancy of the city’s economy, its vacancy rate is around 5%, almost half that of the national average and shows the demand the city centre’s high streets still have for investors, small businesses and international brands.”
Liverpool BID Company represents the interests of 800-plus levy-paying businesses in Liverpool city centre, spread across three business improvement districts covering much of the geography of the city centre.
The letter went on: “With an international airport welcoming flights from over 150 destinations worldwide, two Premier League football clubs and a vibrant music and cultural scene, Liverpool also has a strong travel and tourism sector.
“It is worth £3.5bn with hotel occupancy reaching 1.98m visitors (2021). The visitor economy in Liverpool employs 58,000 people.
“Tax-free international shopping is a valuable aspect of this. We can see the impact of this on our spend data. The total International Spend in Q3 of 2023 is down -10.5% compared to Q3 of 2022.
“International Tourist Spend outside of Europe has dropped -34.6% in Q3. This lack of International Tourist Spend outside of Europe is being impacted greatly by the lack of tourists from the Middle East.
“For example, we have seen a -48% decrease in Spend from Saudi Arabia which attributes to £493,000 in spend. We can also see a decrease in spend in Kuwait (-73.7%) which attributes to £469,000 worth of spend.
“The re-introduction of tax-free shopping would provide a much needed boost to our city centre economy, translating to valuable jobs, and economic self-sufficiency.
“It would increase footfall in key destinations within the city centre, boosting the city’s visitor economy and tourism spend.”
Trevor Brocklebank, chair of Marketing Cheshire and deputy chair of Cheshire and Warrington Local Enterprise Partnership, added: “The Cheshire and Warrington visitor economy is continuing its upward growth and there is considerable work taking place in our region to improve our visitor offer, accessibility and promotion.
“But it is clear that the Chancellor can accelerate that growth by restoring tax-free shopping for our EU visitors.”