Burberry Calls for Tax-Free Shopping Revival to Boost Northern Retail and Tourism

Burberry has called on incoming Prime Minister Andy Burnham to reinstate tax-free shopping for international visitors, positioning the move as critical to reviving luxury retail spending and strengthening the UK’s fashion sector, particularly its northern manufacturing hubs.

According to The Telegraph, Burberry CEO Joshua Schulman revealed the luxury brand’s tourist revenue has declined by approximately 50% since 2019, a drop largely attributed to the abolition of the VAT Retail Export Scheme in 2020.

Under the former scheme, international visitors were entitled to reclaim VAT on UK purchases prior to departure. Its removal, enacted by the Conservative government, has significantly impacted cross-border retail performance.

“Tourist revenue has plummeted by 50% since 2019,” Schulman stated to The Telegraph, “largely due to the absence of the VAT refund program.” He added, “We must implement policies that drive competitiveness and incentivize global travelers to visit the UK, shop here, and experience our offerings.”

The CEO emphasized Burberry’s broader economic contributions beyond London, highlighting its manufacturing facilities in Yorkshire and its Leeds-based office. “We have a significant footprint across the UK, from Yorkshire’s manufacturing hubs to our Leeds operations,” Schulman told the publication. He further asserted that Burberry stands as “the only luxury brand of comparable scale where British heritage remains central to our identity.”

Schulman’s remarks align with the ongoing operations turnaround under his leadership. The company recently reported retail revenue of £455 million, driven by a 12% surge in the Americas market and strengthened demand for key product lines such as outerwear and leather accessories.

His comments have reignited industry discussions around tax-free shopping, with retailers and trade organizations advocating for the policy’s return. They argue that international shoppers increasingly redirect purchases to destinations like France and Italy, where VAT refunds on eligible transactions remain accessible.

A 2023 report by New West End Company estimated the absence of tax-free shopping led to £400 million in unmet retail sales in London’s West End, despite international visitor numbers recovering. The organization continues urging policymakers to restore the rebate scheme to enhance the UK’s allure as a premier global retail destination.

Burnham has also pledged to overhaul business rates reforms, addressing perceived inequities in levies for retailers operating in high-street locations.

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