Scrap the tourist tax to boost UK’s economy says royals’ favourite handbag designer Strathberry

A luxury Scottish handbag brand loved by the Princess of Wales and Meghan Markle has joined calls for the return of tax-free shopping for overseas tourists in a bid to boost the economy.

Ahead of the UK Government’s Budget on Wednesday, Strathberry has united with some of Britain’s biggest retailers to demand Chancellor Rachel Reeves resumes the shopping refund, which removes VAT from purchases made by visitors while they are on holiday here.

It comes after more than 300 businesses, including John Lewis, Estee Lauder and Kurt Geiger, last week wrote to Ms Reeves calling for the resumption of the VAT-free shopping scheme, which they hope will boost economic growth.

Last night Strathberry got behind The Mail’s campaign to reinstate the perk, saying it made the UK ‘a more compelling destination for international clients’.

The Edinburgh-based co-founder of Strathberry, Leeanne Hundleby – whose bags shot to prominence when Meghan Markle sported one at an official engagement – said: ‘We’re fully in support of VAT-free shopping to be reinstated and we would be delighted if this happened.

The Princess of Wales stepping out with the Strathberry Mosaic bag last year

‘It really helps drive traffic and sales to the UK, boosts the contemporary luxury market, and makes the UK a more compelling destination for international clients.

‘When this was in place, our stores, which are in globally renowned locations, saw an increased number of tourists purchasing whilst in the UK.

‘Although we’re delighted our UK stores continue to perform incredibly well and in line with brand growth in the UK and overseas, we would welcome the additional sales revenue that VAT-free shopping naturally facilitates and believe reinstating VAT-free will have a hugely positive impact on the UK economy overall.’

Strathberry’s bags, which cost between £225 and £995, have been showcased by a number of celebrities since the brand was launched by husband and wife duo Guy and Leeanne Hundleby in 2011.

Known for its minimalist and contemporary luxury aesthetic, the label was catapulted onto the world stage after Ms Markle stepped out with one of its designs at an official engagement in Nottingham in 2017.

Strathberry co-founder Leeanne Hundleby wants a U-turn

300 businesses wrote to Chancellor Rachel Reeves last week to demand the return of VAT-free shopping for tourists

Having been pictured carrying Strathberry’s £495 burgundy and blue midi tote, it took just 11 minutes for the bag to sell out. Within days, 3,500 shoppers had signed up for stock updates.

Ms Markle has also appeared with the green clasp East/West bag, which has a gold, cross-body strap and sells for around £500.

Last year the Princess of Wales showed her affection for the Edinburgh brand too, as she was spotted with a Strathberry Mosaic bag in brilliant white at the annual televised carol service.

She paired it with a bespoke Alexander McQueen maxi-coat and mother-of-pearl drop earrings, from French luxury jewellery company Van Cleef & Arpels, which retailed at £6,000.

Strathberry’s calls are the latest in a long list of retailers who have pleaded with successive Chancellors to resume VAT-free shopping for visitors. 

In 2020, then Chancellor Rishi Sunak abolished rules allowing tourists from outside the European Union to claim VAT back on purchases, making goods 20 per cent more expensive.

It was hoped at the last Budget, delivered by Jeremy Hunt, that the so-called ‘tourist tax’ would be scrapped. He was met with fury when such hopes proved unfounded.

Last week, more than 300 brands wrote to Ms Reeves calling on her to resume the scheme.

Dozens of cross-party MPs and peers have already backed the Mail’s ‘Scrap the Tourist Tax’ campaign, including former Home Secretary Priti Patel, as have firms such as Harrods.

A study by the Centre forEconomics and Business Research found that Britain’s economy would be £11.1 billion a year better off as a result of reinstating VAT refunds, with government coffers boosted by £2.5billion.

An HM Treasury spokesperson said: ‘We do not comment onspeculation around tax changes outside of fiscal events.’