As Britons increasingly avoid travelling to European countries due to confusion over Brexit and its associated costs, UK-based shopping destinations have seen a welcome surge in custom from continental tourists looking to take advantage of the favourable exchange rate. However, some of the country’s leading brands are calling for an end to the ‘shopping travel tax’ they claim is having a damaging effect on this burgeoning industry. In this article, we explore the potential positive and negative impacts of this shopping travel boom, and examine the urgent calls for an end to the so-called ‘travel tax’.
1. Tourists’ Shopping Habits Taking its Toll on UK Shopping
The UK is a shopping mecca, boasting a wide array of fancy retailers and quaint local boutiques. Unfortunately, this has come with a considerable price for native British shoppers. Tourists, captivated by the great deals they’re able to find in the UK, are now coming in droves to do their shopping. This has had some peculiar effects on British shoppers:
- Empty Store Shelves. British shoppers are finding out that the shelves in their favorite retailers are emptying faster than usual. Tourists, with their hefty purchasing power, are snatching up the most attractive items and leaving the British with slim pickings.
- Higher Prices. Tourists are not only targeting the most attractive items, but they’re driving up overall prices, too. With more shoppers vying for the same items, the retail prices are automatically inflated.
The problem is taking its toll on the British shoppers, who find themselves spending more money to find the same items. On top of that, shoppers have to face the disappointing voids in their favorite stores left by the travelers. All in all, it’s a stressful shopping habit that the UK has to face.
2. UK’s Shopping ‘Travel Tax’ Proving Costly for Brands
The Increasing Cost of Shopping in the UK
Cheap holidays may be a thing of the past for shoppers travelling to the UK as the government plans to implement a ‘travel tax’. The cost of goods could sky rocket for those travelling over the seas, as the tax is expected to be applied to any items purchased during trips away.
- Retailers have already seen an increase in the cost of their goods, due to exchange rates.
- Passengers arriving in the UK will now be required to pay any applicable taxes on items they are carrying.
- This is expected to have a significant impact on the amount shoppers are willing to spend.
Shoppers looking for bargains abroad could be in for a surprise, as around 70 percent of the value of products bought in EU countries will be subject to the travel tax. The charge will be applied for goods purchased on behalf of people in the UK, as well as those for personal use. The cost of goods across Europe could soon rise if countries follow the UK’s lead and introduce similar taxes for travelling shoppers.
It remains to be seen how shoppers will be affected by the new travel taxation. Regardless, it looks like the days of jetting off for bargain shopping trips may be over.
3. Unpopularity of UK Shopping Leading to Losses
The UK shopping industry is rapidly declining and heading into a recession. Small businesses are the first to suffer from the slump in shopping as the footfall dwindles and orders decrease to a trickle.
Small retailers are feeling the strain of the recession most acutely, with orders dropping off drastically. This is most commonly being seen in luxury or fashion retail, with many store owners hanging their Bowling hats up for good. As a result, the industry is hemorrhaging profits that keep dropping lower and lower.
- Small businesses are the first to suffer
- Orders and footfall are falling
- Luxury fashion retail is particularly affected
- The industry is losing major profits
4. Brands Call for End to UK Shopping ‘Travel Tax
UK’s retailers have demanded an end to the so-called “shopping travel tax” – an economic barrier for customers travelling from the country to make purchases overseas. The call to end this unfair burden on shoppers follows the announcement of rising cost prices of products, largely due to import taxes imposed as a result of Brexit.
The British Retail Consortium has voiced its opposition to the retail travel tax, citing the unfairness of separating shoppers into two distinct groups – those that can afford to visit stores in other countries, and those that are financially unable to do so. In particular, they argued that the tax status would push regional shoppers further into poverty, while the wealthier gain a financial advantage.
- Higher prices: The taxes imposed by Brexit have caused retail prices to be higher than ever due to the import costs.
- Unfairness: Shoppers have been divided into two groups – those who can afford to visit stores overseas, and those who are unable.
- Injustice: Regional shoppers are being pushed further into poverty from the travel tax, while the wealthy reap financial benefits.
As this epidemic continues, it is clear that the time for change is now. With UK shoppers understandably angered by the “travel tax” and tourists choosing to spend their money elsewhere, the government must take urgent action to ensure that the UK remains an attractive destination for shoppers around the world. Here’s hoping that this ‘travel tax’ is stopped in its tracks, and shoppers can once again flock to the UK in search of great prices and world-class brands.
