The Impact of Ending Tax
Free Shopping in the UK
A Cebr report for the New West End Company and Global Blue
This report evaluates the costs and benefits of the proposed ending of Duty-Free Shopping for NonEU visitors to the UK as an indirect result of the Brexit negotiations. It compares looks at the two possible systems. First, the proposed situation where the VAT Retail Export Scheme is scrapped and secondly, the extension of the current scheme to tourists from the EU as well as from outside the EU. The main research in Sections 2-5 use the elasticities approach where conventional elasticities from tourism and tax research by official bodies are applied. We estimate the deadweight revenue losses, the gains from tourism and spending and the net benefits in GVA and jobs and total tax revenue gains after netting off the deadweight losses.
