The United Kingdom says tourists will no longer enjoy tax-free shopping from January 1, 2021.
The UK treasury said the scheme has been a “costly relief that does not benefit the whole of Britain equally”, adding that it was inconsistent with international tax principles.
“As part of these changes, VAT refunds for overseas visitors in British shops will be removed. Overseas visitors will still be able to buy items VAT-free in-store and have them sent directly to their overseas addresses, while the costly system of claiming VAT refunds on items they take home in their luggage will be ended,” it said in a statement.
The UK treasury also said passengers travelling to non-EU countries will also not be entitled to tax-free sales of items such as electronics and clothing at airports.
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“We are also ending tax-free sales in airports of goods such as electronics and clothing for passengers travelling to non-EU countries, following concerns that the tax-concession is not always passed on to consumers in the airport,” it said.
Under the new tax regime, the number of items that non-EU passengers can bring into the UK without having to pay duties will also be increased.
“This means that passengers coming to Britain will be able to bring back, for example, three crates of beer, two cases of still wine and one case of sparkling wine to GB without paying UK duties,” it said.
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The UK is currently in a Brexit transition period that will end on December 31, 2020.
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