aShoppers descended on Oxford Street in Londonin black cabs or on foot to visit the city’s upscale shops on Friday, a huge banner is installed on the Selfridges Tower at the top: “Let’s change the way you shop.”
However, the change may be somewhat different from what is intended. Soon the region may benefit from two plans announced by the Chancellor, Quasi QuartingFriday: Duty-free shopping returns to Main Street and the 45% income tax bracket removed.
Rita Waters, 66, trailing Selfridges with the unmistakable yellow pouch dangling from her arm, welcomed the budget mini Kwarteng. While the VAT change would not alter her shopping habits as a British citizen, she was positive about the decision to scrap the surcharge for those whose annual income exceeded £150,000.
And it will fade,” said the retired Waters. “It’s going to go to people who don’t pay taxes but who probably have more money in their pockets than the treasury.”
As a lifelong conservative voter, she said the budget would give her more to spend and give to food banks. “And I hope others will, too,” she added.
And while she praised other changes, such as stamp duties, she wished there had been an unexpected tax on energy companies. “Give them a chance,” she said of the government’s financial plans. “Give them a chance.”
Like many international travelers visiting London’s main streets, shoe designers Theresa Cladney and Angelique Joseph, hailing from the Midwest, will find that shopping in Britain will cost less than before.
“I think it would be great, as long as you don’t have to go through the trouble of the process,” Cladney said, remembering the hours lost at airports to get back. “If it was an easy process, as in the United States to where, on that day, you wouldn’t be taxed, and you wouldn’t have to do anything. It’s all about convenience. Since everything goes up. It would be nice to see something go down a little bit.” .
Kwarteng intends to digitize the new system, ending the old pen and paper format.
The reintroduction of the tax-free shopping scheme, which was previously abolished in 2021 after Brexit, will allow tourists to recover value-added tax on goods bought on Main Street, at airports and other departure points and exported from the UK in their personal baggage.
The move, which will cost roughly £1.3 billion in 2024-25, comes as the pound is dropping to new lows against foreign currencies, and the country is grappling with the highest inflation in four decades.
For Noria Hafeez, who has worked for years on Bond Street selling fine jewelry, the change will not only bring in greater revenue for the company, but also employee salaries – which depend on commission.
Hafeez, 32, has seen an increase in clients from the US, China and existing clients in the Middle East in London.
“All the luxury comes from the foreigners who travel here,” added Hafez, who has suffered in the past from losing customers who travel to France and elsewhere for VAT-free shopping. “We had to lower the prices of our products a little bit to be able to play with the market, but even so, it’s not good enough. We are losing money for that.”