CHINESE tourists are returning to London after restrictions on travel were lifted, but they are spending dramatically less than before the pandemic.
The New West End Company, which represents stores and hotels in the busy London district, has found that tourists are increasingly aware that the UK no longer offers tax-free shopping post-Brexit, and are diverting their buying to elsewhere in Europe.
It means that even when visitor numbers to the British capital increase, sales are not keeping up.
The number of Chinese visitors to London was just 2 per cent shy of 2019 levels in September, but their spending was down 58 per cent, the group said. Overall, the gap between the total of international visitors and their spending in the capital compared to 2019 has grown from one percentage point in the first quarter to 31 percentage points in the third.
“No tax-free shopping is a major disadvantage in the competition to attract high-spending international visitors,” said Michael Ward, managing director of Harrods, who added that the impact extends far beyond the retail sector in London.
Three-quarters of international visitors to West End said they would spend more if they were able to claim back the 20 per cent value-added tax (VAT) on their purchases. Visitors from outside the EU were able to reclaim tax paid on their spending until January 2021, when the policy expired.
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