What: Chinese tourists are returning to London after COVID-19 travel restrictions were lifted, but they are spending significantly less than before the pandemic.

Why it is important: The New West End Company, which represents stores and hotels in the district, found that tourists are now aware that the UK no longer offers tax-free shopping post-Brexit, causing them to redirect their purchases to other parts of Europe. As a result, even with an increase in visitor numbers, sales in London are not keeping up; The lack of VAT refunds is estimated to cost the UK GBP 10.7 billion in lost GDP and two million extra visitors per year.

In September, Chinese visitor numbers were just 2% below 2019 levels, but their spending was down 58%. The gap between total international visitor numbers and their spending in the capital compared to 2019 has grown from 1 percentage point in the first quarter to 31 percentage points in the third. The absence of tax-free shopping is viewed as a major disadvantage in attracting high-spending international visitors, with many retailers and business leaders calling for the UK government to reintroduce tax reimbursements.

Chinese tourists are returning to London, but spending far less