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<p>In October 2022, to ensure the UK’s economic stability and to provide confidence
in the Government’s commitment to fiscal discipline, the Chancellor announced that
the Government will not be proceeding with plans to introduce a new VAT-free shopping
scheme. Such a scheme would come at a significant fiscal cost as it would subsidise
a large amount of tourist spending which already occurs without a tax relief in place.</p><p>
</p><p>The independent Office for Budget Responsibility published their assessment
of the withdrawal of the previous VAT-free shopping schemes in November 2020. This
showed that withdrawal would raise a significant amount of revenue and have a limited
behavioural effect on decisions to visit, or spend, in the UK. Although the Government
keeps all taxes under review and continues to consider all available evidence as part
of the policy-making process, there are no current plans to commission a further assessment.</p>
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