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Future of British Business

London’s Luxury Brands Suffer Tax-Free Shopping ‘Hammer Blow’

  • Government scraps policy less than a month after announcing it
  • New chancellor tries to reassure markets of fiscal discipline
Luxury goods stores on New Bond Street in London.

Luxury goods stores on New Bond Street in London.

Photographer: Hollie Adams/Bloomberg
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London’s luxury emporiums were up in arms after new Chancellor of the Exchequer Jeremy Hunt scrapped his predecessor’s decision to let foreign visitors claim back value-added tax.

“This short-sighted move is based on inaccurate and incomplete projections,” said Paul Barnes, head of the Association of International Retail, calling the U-turn a “hammer blow to UK tourism and the British high street.”