" class="no-js "lang="en-US"> Planet: UK Shoppers Only Behind the US on Tax Free Goods Spend in the EU - Fintech Finance
Monday, February 06, 2023
Saltedge Report

Planet: UK Shoppers Only Behind the US on Tax Free Goods Spend in the EU

Last year, UK shoppers spent more on Tax Free goods in the EU than any other nation except for the US, according to new findings from Planet, a global technology leader providing integrated software, payment, and technology solutions.

Planet’s latest Intelligence report suggests this trend is set to continue. The UK’s younger mobile consumers are flocking across the Channel and spending more at European retailers than their counterparts in other countries.

Gen-Z, those younger than 26 years’ old, accounted for 28% of Tax Free sales across Europe in December, compared to 10% for other non-EU shoppers. Their favourite destinations were Paris, Barcelona, Milan, Rome and Madrid.

UK Gen-Z shoppers are high spenders too, spending more than €1,800 on average in Rome, or roughly twice what shoppers from other countries outside of the European Union spent. In Milan and Paris, their average spend per transaction is still an impressive €1,600.

In line with customers from elsewhere, UK shoppers are mostly on the lookout for luxury apparel. Their appetite for watches and jewellery is twice that of other nationalities.

This trend of UK shoppers looking for luxury goods in European stores is likely to increase further in 2023 with arrivals from the UK expected to remain at or above 2019 levels throughout the year, a performance most other countries might struggle to match.

Return of Chinese consumers sees retail sales end the year on a strong note.

Tax Free shopping in Europe ended the year on a strong note compared to pre-pandemic levels, as demand from Gulf nations and China gave an additional boost to what was a strong festive holiday season for Tax Free sales.

Total sales in December were close to their high for the post-pandemic era, ticking up marginally to 21% below the same period in 2019.

All in all, it was a good year for Europe’s internationally focused retailers, with a recovery in Tax Free sales from levels in January that were still 66% below pre-pandemic levels. Much of the improvement was due to strong demand from US shoppers, who spent more than any other nationality in every month of 2022.

The strongest gains in December came from shoppers out of the United Arab Emirates (UAE), which jumped from 10th place to fourth place in the overall ranking of top source markets.

And the outlook for 2023 is also upbeat, particularly for the rest of the first quarter. There is likely to be an uptick in travel from Asia with China having reopened its borders to the world after more than 1,000 days of isolation and Gulf Cooperation Council (GCC) countries have holiday breaks and will be celebrating Ramadan.

Luca Cassina, President of Retail at Planet commented: “Despite the ongoing cost of living crisis, UK consumers, especially the younger generations, are displaying a willingness to spend on Tax Free goods when abroad in Europe. This is providing a boost to retailers across the continent.

 “Additionally, when it comes to the list of top international spenders, the only other source market to maintain its position in the top 5 for the whole of 2022 other than the US was the United Kingdom. This reflects the spending power UK consumers have had across Europe’s Tax Free shopping market post Brexit.

 “The continued recovery in Tax Free shopping across Europe brings into sharp focus the extent to which the UK would benefit from introducing a digital Tax Free shopping scheme. This is especially the case as Europe gets ready to welcome back Chinese visitors, who are well-known for their high spending power, particularly on luxury goods.

 “There should be a real sense of urgency now with China having reopened its borders to international travel and airlines gearing-up to provide seat capacity for flights to the UK and Europe. We urge the UK Government to reconsider its position and to look at Tax Free shopping as an opportunity to fully benefit from the return of Chinese visitors to the UK.”

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