The change, however, may be somewhat different than predicted. The region could soon benefit from two plans announced by the chancellor, Kwasi Kwarteng, on Friday: the return of duty-free shopping to the high street and the abolition of the 45% income tax band. Rita Walters has welcomed the government’s decision to scrap the 45% tax bracket. Photo: Antonio Zazueta Elms/The Guardian Leaving Selfridges with the unmistakable yellow bag dangling from the crook of her arm, Rita Waters, 66, welcomed Kwarteng’s mini budget. Although the VAT change will not change her shopping habits as a British citizen, she felt positive about the decision to remove the additional tax on those with an annual income of more than £150,000. “And it will filter down,” said Waters, who is retired. “It will filter down to people who don’t pay tax but maybe have more money in their pocket than the Treasury.” As a lifelong Conservative voter, she said the budget would give her more to spend and give to food banks. “And I hope other people do too,” he added. While he praised other changes such as stamp duty, he wished there was a windfall tax on energy companies. “Give them a chance,” he said of the government’s fiscal plans. “Give them a chance.” Theresa Cladney, left, wants the duty-free process to be easier, like it is in the US. Photo: Antonio Zazueta Olmos/The Guardian Like many international travelers who visit London’s high streets, shoe designers Theresa Cladney and Angelique Joseph, originally from the Midwest, will soon find that shopping in Britain will cost less than before. “I think it would be great, as long as you don’t have to go through the hassle of the process,” Cladney said, recalling the hours wasted in airports for returns. “If it was an easy process, like in the United States where, that day you’re just not taxed and you don’t have to do anything. It’s all about convenience. Since everything goes up. It would be nice to see something come down a bit.” Kwarteng intends to digitize the new system, ending the old pen and paper format. The return of a duty-free shopping system, previously scrapped in 2021 after Brexit, will allow tourists to claim back VAT on goods they buy on the high street, at airports and other points of departure and take out of the UK in their personal luggage . Archie Bland and Nimo Omer take you to the top stories and what they mean, free every weekday morning Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply. The move, which will cost almost £1.3bn in 2024-25, comes as the pound falls to new lows against foreign currencies and the country struggles with the highest inflation rates in four decades. Nuria Hafid says the change will bring greater returns for businesses and workers’ wages. Photo: Antonio Zazueta Olmos/The Guardian For Nouria Hafid, who has worked for years on Bond Street selling high-end jewellery, the change will not only bring greater returns for the business, but also workers’ wages – which are commission-based. “I think it’s going to be really good because to be honest tourists are coming back to London after Covid, they’re here, they’ve got money and they want to spend,” said Hafid, 32, who has seen an increase in clientele since USA, China and existing Middle East clients in London. “All the luxury comes from foreigners traveling here,” added Hafid, who in the past has experienced a loss of customers traveling to France and elsewhere for VAT-free shopping. “We had to mark down the prices on our products a bit to be able to play with the market, but again, it’s not good enough. We’re losing money on it.”
