A recent report from Walpole has shed light on the significant impact of the British luxury sector on the UK economy. The report reveals that the sector is now valued at a staggering 81 billion pounds annually, supporting over 450,000 jobs across various industries. This makes it one of the key drivers of the UK economy, contributing 3.7 percent of the country's GDP.
Despite facing challenges such as Brexit, the Covid-19 pandemic, supply chain issues, and rising energy costs, the luxury sector has shown remarkable growth, with a 69 percent increase in economic contribution over the past five years. Total exports from the UK luxury sector have also seen a substantial rise, increasing by 45 percent to 56 billion pounds.
The report highlights the sector's role in generating tax revenue, with the Exchequer raising 25.5 billion pounds in tax receipts. However, the report warns that without tax reform and changes to intellectual property laws, the sector's growth could be hindered.
Looking ahead, the report forecasts that by 2028, the British luxury sector could be contributing 125 billion pounds annually to the economy, surpassing industries such as life sciences and construction. To achieve this growth, the sector will need support in areas such as intellectual property laws, tax policies, and regulatory frameworks.
Walpole is advocating for reforms to the UK's Geographical Indicator regime to include non-produce-based craft products, as well as urging policymakers to create a tax and regulatory system that supports high-quality employment. The report also emphasizes the importance of reintroducing VAT-free shopping for international visitors to boost revenue and employment opportunities.
Notable performers within the British luxury sector include high-end automotive companies like Aston Martin, Jaguar Land Rover, Rolls Royce, and Bentley, which have reported significant turnover in recent years. The sector's resilience and growth potential have been lauded by industry leaders, highlighting its critical role in the UK's economic and cultural landscape.
