AIR in the news


Please find below press clips of AIR.

In Britain, Watch Sellers Shocked at End of Sales Tax Refund

The New York Times
19/11/20

“We’ll have Chinese visitors, because the market is growing, but they just won’t be spending money here” said Paul Barnes, chief executive of the Association of International Retail in Britain. “They’ll come and visit the U.K., but they’ll wait until they get to France to do their shopping.”

Read the full article here.

U.K. Tax-Refund Repeal Is a New Headache for Retail Property Owners

The Wall Street Journal
24/11/20

“I thought that the point of Brexit was that we were going to become more competitive,” said Jace Tyrrell, chief executive of the New West End Company, which represents some 600 businesses in central London, including Nike Inc., Apple Inc., and Ralph Lauren Corp. “This is going to affect not just London but regional cities like Edinburgh which rely on tourists.”

Read the full article here.

End of VAT refunds would deter Chinese UK visitors

China Daily
25/09/20

Paul Barnes chief executive of the Association of International Retail said: “Chinese visitors are by far the biggest international shoppers in the UK and shopping is the main reason they visit. If Britain ends its tax-free scheme, Chinese travellers are much more likely to visit any other European country for shopping. At a time when the British tourism industry and London’s international centres are already suffering so much from the impact of COVID-19, it seems a very damaging and unnecessary political decision”.

Read the full article here.

Retailers On Collision Course With U.K. Treasury Over Abolition Of Tax-Free Shopping

Forbes
23/09/20

The Association of International Retail (AIR) says that one reason the U.K. government is dropping tax-free shopping is that the current paper-based validation system used by the tax department, HMRC, would not be able to manage VAT refunds once they become available to EU tourists from January. EU travellers account for 70% of all U.K. visitors.

AIR’s CEO Paul Barnes believes that a way forward could be through a cooperative stance. “Government should use the 18-month window of low international visitor numbers (due to Covid-19) to work with retailers and their partners to provide a digital solution to the validation element,” he said. “Linked to existing retailer digital infrastructure, this will provide the necessary capacity within 12 months and at no cost to government. Retailers have done this with many governments around the world.”

Read the full article here.

Bye, bye tax-free shopping

National Herald India
18/12/20

“Madrid, Milan and Paris are rubbing their hands with glee at this self-inflicted wound,” said Paul Barnes, head of the Association of International Retail. “If we charge a fifth more for the same goods, international visitors will not hesitate to switch their city breaks to other countries”.

Read the full article here.

Fortnum & Mason boss hits out over tourist tax that could cost businesses at least £2bn

Daily Mail
26/12/20

“Paul Barnes, chief executive of the Association of International Retail, said long-distance tourists who travel from places such as China – which puts £1billion into shop tills – may instead skip Britain and head to Paris where the loophole remains. He said: “Non-EU visitors spend around £18billion a year in the UK. Only £3billion is on shopping, which you could call a ‘loss leader’, but the remaining £15billion is VAT-able. Yet the Treasury has admitted that it only looked at shopping, not the wider impact on the economy”.

Read the full article here.

40,000 jobs are under threat if duty-free shopping is scrapped, retail organisation warns Rishi Sunak

Daily Mail, This is Money
21/11/20

Last night, Paul Barnes, chief executive of AIR, said: “I would urge the Chancellor to look again at the numbers. It is not just the high street that he is putting at risk, but also people’s livelihoods”.

Read the full article here.

Ending VAT-free shopping ‘will hit UK tourism and retail’

The BBC
20/09/20

The Association of International Retail (AIR), which co-wrote the letter, urged the chancellor to “look again at this devastating decision”.

Read the full article here.

End of duty-free shopping for tourists may mean big job losses

Telegraph
30/09/20

Paul Barnes, chief executive of the Association of International Retail, criticised the decision to scrap tax-free shopping.  “Making the UK the only European country not to offer [it] to international visitors sends totally the wrong message to the world. And it needlessly damages the UK’s retail, tourism and manufacturing industries, already struggling to survive Covid-19,”

Read the full article here.

Move to end VAT-free shopping for tourists ‘needs more scrutiny’

Telegraph
04/12/20

Paul Barnes, chief executive of the Association of International Retail, said: “There is every chance that the £400m, they think they will be making will be more than wiped out … the moment you take away tax free shopping they will go to France or Germany.” 

Read the full article here.

What is the tourist VAT tax and why is Duty Free allowance being cut?

Evening Standard
03/12/20

Estimates by business bodies such as the Association of International Retail suggest that more than one million high spending tourists will be deterred from visiting Britain, or at the very least, reduce the number and duration of their visits.

Read the full article here.

Heathrow Airport to launch legal review over VAT-free shopping ban

Yahoo News
02/11/20

The Association of International Retail (AIR) urged the chancellor to “look again at this devastating decision”.

Read the full article here.

VAT change ‘will cost Edinburgh £90m’ and could affect 1800 jobs

The National
22/09/20

Paul Barnes: “The Government’s decision to eradicate tax free shopping in the UK will impact Britain’s reputation and appeal as a global shopping destination, providing further damage to our struggling economy. Outside of London, Edinburgh is a key tourist attraction for visitors, proven in the growing number of international flights to Edinburgh airport. The removal of tax free shopping will not only impact the cities retail sector but be a huge blow for hotels and restaurants who are reliant on international visitors”.

Read the full article here.

Boris Johnson shows why he’s bad for business, jobs and the economy – Angus Robertson

Edinburgh Evening News
22/09/20

According to the Association of International Retail, nearly a fifth of the £22bn spent in UK by international tourists was in Edinburgh.

Read the full article here.

Marks & Spencer, Selfridges and Heathrow blast Chancellor’s plans to impose tourist tax raid

Retail Times
21/09/20

Paul Barnes, CEO of the Association of International Retail, said: “The Chancellor needs to look again at this devastating decision, as it simply doesn’t add up and will lead to the loss of tens of thousands of tourism and retail jobs right across the UK. Madrid, Milan and Paris are rubbing their hands with glee at this self-inflicted wound. If we charge a fifth more for the same goods, international visitors will not hesitate to switch their city breaks to other countries and the stores and jobs will follow within months.”

 “UK travellers who’ve shopped abroad and enjoyed a discount will recognise how important these schemes are, and how quickly those savings are then spent on extra holiday treats. In taking this money out of the hands of our own international visitors, the Chancellor is impoverishing all those who depend on tourist spending right across the UK”.

Read the full article here.

Time to woo overseas shoppers

Property Week
02/07/20

Open-ed by Paul Barnes, CEO of the Association of International Retail

Read the full article here.

UK to end VAT-free shopping for visitors on Jan 1

Fibre2Fashion.com
22/10/20

The Association of International Retail (AIR), which co-wrote the letter, urged the chancellor to “look again at this devastating decision”. It cautioned the United Kingdom will become the only European country not to offer VAT-free shopping for international visitors.

”Madrid, Milan and Paris are rubbing their hands with glee at this self-inflicted wound,” said AIR boss Paul Barnes.

”If we charge a fifth more for the same goods, international visitors will not hesitate to switch their city breaks to other countries, and the stores and jobs will follow within months”.

Read the full article here.

Zut alors: Why London could lose £1.1 billion in fashion sales to Paris

The Telegraph
29/01/21

“These people – who mostly come from China and the Middle East – have contributed a huge amount to the British economy but will simply make the choice not to shop in the UK because it is less advantageous to them,” says Paul Barnes, the CEO of Association of International Retail. “We are now the only country in Europe offering no VAT rebate, so why would tourists not go to Paris instead, if they can save thousands of euros on luxury goods there and nothing here?”

Read the full article here.

Retail’s 3 R’s: Reopening, Recovery, Resilience

DRD Partnership
20/02/21

Ahead of the Prime Minister’s announcement on Monday, DRD Partner and Chief Executive of the Association for International Retail (AIR), Paul Barnes, shares his insight about what’s in store for the retail and hospitality sectors in the coming weeks and months.  

Read the full article here.

Tax-Free Sales, The Traveler Experience, And The Airport Financial Model

Forbes

09/03/2021

 

Paul Barnes CEO of the Association of International Retail (AIR) tells Forbes.com: “Tax-free sales, apart from in Hainan, are virtually zero across the world right now because there is not much international travel due to the pandemic. When travel resumes, high spenders who travel a lot will choose to shop in Paris or Milan and skip Britain for shopping, even if they come here. They may also spend less time in the country.” That will mean lost revenue to the wider hospitality industry.

High-rolling travelers spend disproportionately more on tax-free shopping. In 2019, 13% of them accounted for 42% of all tax-free shopping in Britain and the top 1% account for 20% of it. That elite group splash out an average £60,000 each year according to AIR and their average £12,000 tax refund will be a major motivator in their choice of destination.

Read the full article here.

Crowds surge back to London’s West End as lockdown curbs are lifted

Evening Standard

19/04/21

A group of senior London business leaders today wrote to Boris Johnson calling for an urgent update on the review of social distancing measures.

The letter, organised by lobby group London First, from leading business figures including Paul Barnes, chief executive of the Association of International Retail, and Kate Nicholls, chief executive of UK Hospitality, said: “You often fondly recall from your time as Mayor of London the wonderful attractions that the city has to offer.

“The sooner we can open up and get people back the sooner we can all experience them again — and to do that we need to have the conclusions of the social distancing review. We urge you to publish it as soon as possible; the viability of so many businesses depend on it.”

 

Read the full article here.

 

 

 

 

 

 

Dixons Carphone shuts airport stores following axing of duty-free shopping

Evening Standard
28/04/21
Electricals retailer Dixons Carphone has decided to close its airport stores business, just months after a scheme allowing VAT-free shopping for overseas tourists was scrapped.

The stores will be the first major casualty of the post-Brexit “tourist tax”, which was bitterly fought by retailers, hospitality and other tourism-dependent businesses.

Paul Barnes, chief executive of the Association of International Retail, said: “Ending tax free shopping puts over £3 billion of international visitor spend at risk each year as high-spending travellers divert their shopping to Paris or Milan.”

A judicial review of the duty free decision by the Treasury is expected to come up with a ruling soon, possibly as early as this week.

 

Read the full article here.

How the UK became the sick man of European tourism

CNN

13/11/21

A spokesperson for the UK’s Association of International Retail told CNN that the axing of the scheme is predicted to lead to a drop of 38% in retail sales to non-EU visitors, compared to 2019 — a loss of £1.2 billion ($1.6 billion) to the economy.

But that’s not all. “There are also likely to be indirect losses as high-spending visitors travel to the UK less often and spend less time here, preferring instead to visit countries where they can buy goods for 20% less than in the UK,” they said.

Visitors from China and the Gulf Cooperation Council countries comprise 4% of visitors to the UK, but make around 60% of tax-free purchases.”

Research shows that over 50% of Chinese visitors and over 60% of visitors from the GCC would reduce the number of times they visit the UK and the length of time they spend here — as a direct result of ending tax-free shopping,” they said.

Read the full article here.

A global city needs a global advantage

Evening Standard

16/11/21

As Chairman of AIR and CEO of the New West End Company, Jace Tyrrell knows what makes a world capital tick, and here he argues for a simpler visa process for the millions of overseas visitors to London.

As Christmas shopping kicks into gear across the capital, retailers and leisure operators alike will be hoping for a booming festive season to offset the losses endured over the past 20 months.

However, to have any hope of strong returns this winter, they will have to rely on patronage from the British public, as overseas visitors continue to stay away. While the pandemic lingers on, travel restrictions are not the only reason for this dip in spend from abroad.

Historically, we’ve competed with European cities such as Paris and Milan in enticing holidaymakers to our streets. However, as it stands, I’m sad to say that London is no longer the most appealing destination for those shoppers looking to board a plane and enjoy some well-deserved retail therapy.

The Schengen visa, which applies to our European rivals, grants multiple entry to its holders over a six-month period and can be obtained with relative ease and efficiency. The UK equivalent only allows one visit in the same six-month period, and is only granted at least 48 hours before departure, removing the possibility of a last-minute trip for any would-be shopper trying to accommodate a busy schedule.

Given that these European cities already have a 20 per cent price advantage over the UK, following the abolition of tax-free shopping earlier this year, surely we can agree that we should be doing everything in our power to level the playing field?

Read the full article here.

Bosses beg Rishi Sunak to bail out TfL after threat to axe Tube lines

The Times

05/12/21

AIR joined eighty business and charity leaders to urge Rishi Sunak to extend his Covid-19 bailout to Transport for London this week to avoid derailing the government’s levelling up agenda.

The financial lifeline the chancellor threw to TfL during the pandemic ends on Saturday and, without a solution, London’s mayor Sadiq Khan has warned that one of the 11 Underground lines might have to be closed.

“Levelling down the country’s most powerful economic engine would hold back the UK’s economic recovery,” the business leaders wrote.

Read the full article here.

AIR joins new Coalition for International Travel

AIR joined with other businesses to launch a new, economy-wide coalition which believes strongly in
the business case for international travel and its role in a rapid recovery for the UK.

The group wrote a letter to the Prime Minister, Rt Hon Boris Johnson, informing him of the importance of international travel to the UK economy. The industry supports hundreds of thousands of jobs and contributes to economic growth in every nation and region of the UK.

The group urged the Prime Minister to make a number of policy amendments to help to support the sector.

Read the full article here.

UK falling behind EU rivals on tourist spending after duty chances

Financial Times

Daniel Thomas

07.03.22

Britain is losing its position as the favoured destination for high spending international tourists to the EU after the government abolished tax-free shopping at the start of last year, according to a new study.

Global Blue, the tax-free shopping refund agency, compared the behaviour of Gulf state tourists in the EU in 2019 with their shopping habits last year. It found that about a fifth of those shopping in the bloc in 2021 had previously only shopped in the UK two years earlier, where they spent an annual average of €24,000 each.

Last year, their spending dropped to zero in the UK but reached €22,000 each in the EU. Close to a third of those shopping in the EU in 2021 had previously shopped in both continental Europe and the UK in 2019, but increased their average annual spending per person in the bloc by 40 per cent to €22,000 last year, the study found.

To read the full article, click here.

Everything that Jeremy Hunt has thrown out of the mini-Budget

The Telegraph

Tim Wallace, Hannah Boland, Charlotte Gifford, Lauren Almeida and Eir Nolsoe

17.10.22

Tourists will not benefit from the return of tax-free shopping to Britain as Mr Hunt sought to claw back £2bn in savings, prompting fierce criticism from industry leaders.

Retailers said the U-turn would be a hammer blow to tourism and the high street.

Paul Barnes, chief executive of the Association of International Retail, said: “This short-sighted move is based on inaccurate and incomplete projections, and risks putting a brake on the return of international visitors who are vital drivers of economic growth throughout the UK”.

To read more, click here.

VAT free shopping U-turn ‘major blow’ for West End as tourists shun London for Paris and Milan

Emily Hawkins

20.10.22

Scrapping VAT free shopping for tourists is a “major blow” for London and the country’s economy, a group representing luxury stores in the West End and other retail hotspots has said.

Paul Barnes, chief executive of the Association of International Retail (AIR) – whose members range from Bicester Airport to Heathrow Airport – told CityA.M. the policy had been “one of the few measures in the growth plan that would have directly and quickly lead to increased economic growth across the country.”

High spending international visitors from the US and Gulf States were “shunning Britain” currently and jetting off for shopping sprees in Paris and Milan while “giving London a miss,” Barnes said.

To read more, click here.

Fashion retail calls for stability following emergency fiscal plan

Drapers

Zoe Hu and Sabina Weston

The government announced plans last month to consult on introducing a new tax-free shopping scheme for Great Britain, and said it would modernise the one in place in Northern Ireland. The government abolished the VAT Retail Export Scheme (RES) on 31 December 2020, when the Brexit transition period ended, arguing that it offered little benefit to many parts of the UK and was inconsistent with international norms.

Paul Barnes, chief executive of the Association of International Retail, agreed: “The decision to reverse plans to reintroduce VAT free shopping for international visitors will come as a hammer blow to UK tourism and the British high street. This short-sighted move is based on inaccurate and incomplete projections, and risks putting a brake on the return of international visitors who are vital drivers of economic growth throughout the UK. 

To read more, click here.

UK executives stunned as chancellor shreds ‘pro-business’ mini-Budget

Financial Times

Daniel Thomas, Jim Pickard, Oliver Barnes

17.10.22

Paul Barnes, chief executive of the Association of International Retail, said the decision to reverse plans to reintroduce VAT-free shopping for international visitors “will come as a hammer blow to UK tourism and the British high street”.

To read more, click here.

Tax-free shopping deserves a second look

The Times

Sir Geoffrey Clifton-Brown

15.11.22

When the chancellor cancelled most of the proposals in the poorly-received former Growth Plan, he calmed the markets. But he also threw away one growth measure that had been widely welcomed — the reintroduction of tax-free shopping.

Restoring tax-free shopping for international visitors was set to deliver a multi-billion pound boost to Britain’s tourism, hospitality and retail sectors; the very businesses that had suffered most from the Covid-19 lockdowns.

Click here to read more.

Tax-free shopping is a simple gift for growth

Evening Standard

Ed Vaizey

15.12.22

Last week, Jeremy Hunt unveiled the “Edinburgh Reforms”, with the aim of revolutionising the UK’s financial service sector, seizing the benefits of Brexit and promoting growth. Today, in the House of Lords, I will be making the case for the Chancellor to take another look at the tax-free shopping scheme as a vital growth measure. The Chancellor has succeeded in calming the markets with the November Autumn Statement.

A recent study conducted by Oxford Economics and the Association of International Retail proves that this low-cost measure would have an immediate benefit, supporting tourism, retail and hospitality industries not just in London but across the UK.

The Chancellor is right to be looking at growth measures having steadied the ship and the opportunities presented by Brexit, such as tax-free shopping, should be reconsidered not just in the financial services industry but, in other industries, as well. The restoration of tax-free shopping will help our retail, tourism and hospitality industries to thrive.

To read the full article click here.

AIR makes joint Budget Submission with UKInbound 

AIR

11.03.22

On November 3rd 2022, AIR makes joint Budget Submission with UKInbound to the Chancellor.

In the Budget Submission, we are writing to request that the Chancellor asks the Office of Budget Responsibility to review HM Treasury’s estimate of the costs of the scheme in light of a new report published today by Oxford Economics into the full economic impact of the scheme.The report was commissioned in September by the Association of International Retail in response to
the cost estimate of £2bn in the Growth Plan.

To read more, please click here.

AIR’s proposals included in DCMS’s report on “Promoting Britain Aboard”

DCMS

24.10.22

Tourism is a cornerstone of the British economy. As one of the most popular destinations in the world, with its heritage, culture and landscape drawing millions of visitors every year, Britain is a global brand. Inbound tourism is the UK’s third largest service export, worth 9% of GDP, and is the industry on which 3.2 million jobs and more than 200,000 SMEs depend. But the sector was decimated by the pandemic and now has a long haul back to its previous success, let alone to surpass it. We wanted to examine the barriers to it doing so and identify the support it needs.

Committee recommendations include call for an independent assessment of TFS, as proposed by AIR.

To read the full report click here.

Media coverage of AIR's tax free shopping campaign


Ending VAT-free shopping 'will hit UK tourism and retail'

Source: BBC News

Chancellor warned scrapping tax-free shopping risks 70,000 jobs

Source: The Guardian

Rishi Sunak faces backlash from retail giants including Selfridges, Harrods and Marks & Spencer over plans to axe tax-free shopping that ‘will drive foreign shoppers to Paris’

Source: The Mail on Sunday

Scrapping VAT relief for international visitors will have ‘untold impact’ on Greater Manchester economy, industry leaders warn

Source: Business Live

News on AIR's COVID-19 support


The Chancellor has announced an extension to the furlough scheme until October and more flexibility and some employer contribution from August

Click here to read

In response to this, Paul Barnes, CEO of The Association of International Retail said: “Covid-19 is financially impacting many sectors, but none more so – and none will suffer for as long – as those dependent on international visitors.  We are pleased that our campaign for greater flexibility around part-time furloughing has been successful so far, but we’re concerned that the Government’s support may stop abruptly in October, before overseas visitors return in meaningful numbers.  Cutting the cord too soon will not just be catastrophic for retailers, theatres, hotels and their associated businesses – its cumulative effect will risk London and the UK’s position as a leading global destination.  We await further detail later this month and will continue to campaign for the support needed by the international retail sector, otherwise we risk seeing some of our historic businesses shutting up shop for good.”

AIR Briefing: Continuing business support for companies with significant sales to international visitors

Nickie Aiken MP's letter to UK Chancellor of the Exchequer Rt Hon Rishi Sunak MP

Tory MP calls on government to extend job retention scheme

Source: City A.M

Click here to read

Pre-lockdown COVID-19 response

Now updated and incorporated in the AIR, New West End Company and Walpole International Retail Campaign

Click here to read