Sunak tourist tax hit luxury watch sales at Heathrow and Gatwick airports

Brian Duffy, chief executive of Watches of Switzerland, says tourists are 'definitely not spending' in the UK despite a surge in visitor numbers. numbers at Heathrow and Gatwick Credit: Julian Simmonds

Sales of luxury watches at Gatwick and Heathrow airports have fallen due to Rishi Sunak's tourist tax, Britain's largest retailer Rolex and Omega said.

Brian Duffy, chief executive of Watches of Switzerland, said sales at the company's Gatwick and Heathrow boutiques are still less than half their pre-pandemic levels. tourists after the UK left the European Union, a decision that was made when Rishi Sunak was chancellor.

Tourists from the US and Asia visiting the European Union can still receive VAT refunds, which means that items luxury can be significantly cheaper in cities like Paris and Milan compared to London.

Mr Duffy said there was «no incentive» for visitors to the UK to spend money here as a result. He said that American and Asian tourists are «definitely not spending money» in the UK, despite a surge in visitors to Heathrow and Gatwick.

He said: «Some people are going to shop to some extent, when they holiday in the UK, because we all spend time abroad, but it's not what it used to be, and not what it will be in big European cities.

Tourism is lagging behind

Watches of Switzerland operates stores under its own name, as well as branded boutiques of luxury watch manufacturers, including Rolex, Omega, TAG Heuer and Breitling.

The company also owns the watch and jewelry stores Mappin & Webb and Goldsmiths in the UK, and Mayors and Betteridge in the US.

Watches of Switzerland is the latest luxury goods company to announce its opposition to the tourist tax along with executives from Burberry, Harrods and Harvey. Nichols also attacks politics.

Mr Duffy said: “The airport should be a good environment for luxury shopping. People have time, they feel good because they go on vacation, and we all spend more money when we go on vacation.»

Despite strong objection, Duffy said it «doesn't feel like it's like attitudes within government are changing.»

A government spokesman said duty-free shopping is available to all non-UK visitors «who buy items in the store and have them shipped directly to their overseas address.»

It said: «Extending the scheme to EU citizens could cost UK taxpayers around £1.4bn a year, meaning it would require higher taxes to pay for it at a time when we have already passed difficult decisions. to reduce debt.”

Sales of Watches of Switzerland fell to £382m in the 13 weeks to 30 July, compared to £391m in the same period a year earlier.

However, the retailer said demand for luxury watches continues to outstrip supply, with queues getting longer and average prices rising.