Former Chancellor Nadhim Zahawi joins calls for Government to scrap tourist tax
Former Chancellor Nadhim Zahawi joins calls for Government to scrap tourist tax as clamour grows for Rishi Sunak to bring back VAT-free shopping for overseas tourists to help businesses ‘boom’
- Mr Zahawi says decision to scrap benefit has pushed foreign tourists away
- Referring to PM’s top five priorities, he says growing economy is most important
Tory former chancellor Nadhim Zahawi has joined the growing clamour of calls for the Government to scrap the controversial tourist tax.
Writing for The Mail+ app, he urges Rishi Sunak to reinstate tax-free shopping for overseas tourists to help businesses ‘boom’.
Mr Zahawi says the Government’s decision to scrap the benefit has pushed foreign tourists away and is hampering growth.
Referring to the Prime Minister’s top five priorities, Mr Zahawi says growing the economy is the most important.
In his first major intervention since leaving the Cabinet earlier this year, he writes: ‘If we’re not growing our economic pie then arguments over how much goes to the taxman leads to everyone feeling like they’re paying more for less.
Nadhim Zahawi says the Government’s decision to scrap the benefit has pushed foreign tourists away and is hampering growth
‘So what things can we do to help businesses boom? I would suggest bringing back the VAT refund for tourists spending money in the UK.’
The former chancellor warns the decision to scrap the tax refund has pushed people to spend elsewhere.
‘We’re not arguing over what size of pie that goes to the taxman. The pie’s disappeared, and it’s turned up in Paris as a tarte au citron,’ he adds.
Mr Zahawi says it is not just major retailers being impacted, but tourist destinations across Britain – including his constituency Stratford-on-Avon.
‘As we move into a world where international travel is no longer affected by Covid restrictions, areas like my constituency… are eyeing up these dollars and yen to boost our own local economy too,’ he writes.
Mr Zahawi says he does not want to see business revenue ‘leaking away’ from Britain, as the money is ‘needed’ for the Prime Minister’s priorities.
The former chancellor warns the decision to scrap the tax refund has pushed people to spend elsewhere (Stock image)
Mr Zahawi is the latest senior Tory to back the Mail’s campaign to ‘Scrap the Tourist Tax’.
A host of former cabinet ministers – including fellow ex-chancellor Sajid Javid – have voiced support. And some 40 Tory MPs and peers have written to the Chancellor Jeremy Hunt urging him to reinstate tax-free shopping.
Business Secretary Kemi Badenoch is understood to have heard complaints from businesses and has been raising their concerns. Tory Party chairman Greg Hands is also thought to strongly back the campaign.
They are joined by more than 200 business leaders from across the retail, hospitality and tourism sectors.
Scheme ‘boosted economy’
Pressure on the Government to scrap the tourist tax mounted last night after a survey found tax-free shopping was a major boost to the British economy.
The leaked analysis, which has been seen by the Mail, was carried out by the Treasury before it scrapped VAT-free shopping in 2020 but has never been made public.
The report revealed the scheme was popular with foreign visitors and much of the money they saved was spent in the UK. The online survey of almost 800 travellers from China, India and the US was conducted in June 2020 – three months before then-chancellor Rishi Sunak announced the scheme would end on December 31 that year.
Some 67 per cent said that the availability of tax-free shopping influenced their decision to come to Britain. And almost two thirds said it meant they spent more during their visit.