Brexit dividend squandered as UK misses chance to be ‘Europe’s shopping capital’

Britain is missing out on a golden post-Brexit opportunity to become “the undisputed shopping capital of Europe”, a tourist industry leader has warned.

The Tourism Alliance today published its new “manifesto” for tourism in the next Parliament, entitled “Realising the Potential”.

And the report’s 20-point plan highlights several shortcomings in UK government policy.

Tourism is one of the most important generators of export revenue in the service sector, second only to financial services.

Prior to the pandemic, the tourism industry employed 3.4 million people in more than 300,000 businesses, spread across every constituency in the UK and generating more than £150 billion every year for local communities.

If a country gets its tourism proposition right, it is a powerful creator of jobs and prosperity, the report argues.

However, too often UK government policy has not been directed towards helping it in areas including visas, border security, employment, regulation, and VAT, it adds.

According to The World Economic Forum, the UK ranks 116th of 117 countries in terms of price competitiveness, largely driven by high taxes imposed on visitors.

Additionally, the country ranks 76th of 117 countries in terms of “tourism policy prioritisation”, down from 55th place in the previous survey, the TA says.

Central Government funding for tourism development and promotion in the UK is one of the lowest of the world’s major global tourism destinations, with a spend of just £0.81 per person compared to an average of £5.88 across the nine other competitor destinations surveyed.

As a result of the low level of investment in international marketing and promotion, the UK gets just £391 per person in revenue from overseas visitors, compared to an average of £689.

The report explains: “With Brexit, the UK could have become the undisputed shopping capital of Europe, but at the beginning of 2021 the UK closed its VAT Reclaim Scheme and became the only European country not to offer tax-free shopping to visitors.

“Retaining and expanding the Scheme to cover EU countries would have given the UK tourism and retail sectors a considerable competitive advantage in attracting visitors who would otherwise holiday elsewhere.”

Research undertaken by Oxford Economics calculated that reinstating and expanding the scheme would boost visitor numbers to the UK by 1.6 million per annum, supporting 44,000 jobs in tourism and retail, and a further 34,000 jobs in the supply chain, the report pointed out.

That would consequently generate an ex £940m per annum in tax, resulting in a net benefit to the Exchequer of £350 million a year.

Tom Jenkins, Chair of the Tourism Alliance, said: “Some of these proposals involve investment.

“Yet many of the crucial points involve no money. It costs nothing to improve our burdensome visa process.

“It costs nothing to allow European schoolchildren to be able to visit the UK with their ID cards.

“It costs nothing to enable young people to come and work in an industry desperate for their services.

“Tourism is the lifeblood of communities. It is a vital component in the viability of local shops, restaurants and attractions. It sustains city centres as much as rural areas.

“It can be a platform for export-led prosperity. If it is to reach its manifest potential, we need political will.”

Express.co.uk has approached the Department for Culture, Media and Sport for comment.