The head of British luxury brand Mulberry has called on the government to restore free shopping for international tourists, warning it is an “unrealistic burden” on investment and is driving wealthy shoppers away from the UK.
Andea Baldo chief executive said the move would help revive Britain’s luxury and retail sectors – which have been hit hard by reduced VAT rebates for overseas visitors – while boosting VAT revenue and tourism.
“Bringing back unlimited shopping by tourists will help the economy,” said Baldo. “You compete with Paris and Rome – Giving them an unfair advantage makes no sense.”
According to data from Global Blue, Spending by non-EU visitors is at 75% of pre-pandec levels, compared to an increase of 166% in Spain and 159% in France.
Mulberry estimates it has lost around £10 million in sales in the UK since the introduction of the VAT system. Baldo said the loss of international footfall was particularly noticeable in London:
“We’ve lost about a fifth of our traffic from international tourists. Our stores in Dublin and Amsterdam have almost doubled their business from travelers.”
Baldo said the reinstated VAT rebate would directly support UK manufacturing, with Mulberry’s Somerset production sites set to benefit from higher output if the policy is reinstated.
The comments come as Chancellor Rachel Rene is facing increasing pressure to stimulate growth after the office to find the strength of the budget warned of the strength of the economy in Britain, creating a deficit of $ 27 in the budget forecast.
Baldo admitted that vat-free renewable farming was politically feasible but it was a matter of international competition, not of leveling the playing field. “
He added that removing the tax would provide a boost to retail, hospitality and tourism – indicators that are critical to the UK’s economic recovery.
“Our business would invest heavily in UK manufacturing, and hotels, restaurants, and high street stores would benefit from the acquisition of international shoppers.”
Since joining mulberry last year from the Danish Brand Ganni, Baldo Uye sought to strengthen the company for the next years of restunce, a group of shareholders among the owner of Ong Beng Seng Seng Seng Seng, which holds a 37% stake.
The relationship has since been developed, with Frasers now supporting Mulberry’s strategy and investing in its products in 15 of its stores, as well as owning it and John Lewis.
Mulberry, which raised £20 million in new funding this year, plans to open up to five stores in major UK cities including Birmingham and Liverpool, as it focuses on reconnecting with British consumers.
Baldo said the company is rebuilding its reputation as an affordable luxury brand while maintaining its British heritage. Sales at the store’s Terent Street store are up 16% year-on-year, and the relaunch of the Icoxanne bag has attracted renewed interest from younger shoppers.
“We got a good momentum, although it will take a minute to get back to the advantage,” said Baldo. “If we can endure the passion for the product, we can grow the business.”
Baldo said Mulberry’s reforms would be successful without further government measures, but warned that further tax increases could damage consumer confidence.
He also described the return of VAT-free shops as “a gift under the Christmas tree” with the problems of British luxury, sales and tourists urgently.
“We’re not asking for special treatment,” he added. “We are asking for equality – and the opportunity to compete on equal terms with the rest of Europe.”
