Mulberry is pulling the shutters down in Bond Street for the last time (Nick Ansell/PA)
(Picture: PA Wire)Mulberry, the world-famous British fashion brand, will close its Bond Street store for the last time today, as the demise of lower-tax shopping for tourists leaves London boutiques struggling to compete with rivals in Paris, Milan and Rome.
The A-List’s favourite handbag designer made the move after the end of a rebate scheme for travelling spenders. Visitors from abroad will not be able to claim back the 20% VAT levied on their purchases, after plans to re-instate perk were axed by Chancellor Jeremy Hunt, to the dismay of the capital’s retailers.
Known as Tax Free for Tourists, the £1.3 billion scheme was part of the unfunded and short-lived mini-Budget drawn by Liz Truss’s government during its turbulent 49 turbulent days in Downing Street.
Hunt made the move as part of wider measures designed to soothe fears on international financial markets about the UK’s public finances after the shockwaves caused by the massive programme of unfunded tax cuts.
As he scrambled to regain the faith of buyers of government bonds who were spooked at the cost of the entire mini-Budget, which Hunt dumped almost in its entirety. He is due to outline his next set of tax and spending plans in March.
Retailers had welcomed the potential return of the rebate, which first disappeared in 2021 the wake of Brexit, when Rishi Sunak was Chancellor. Its refunds drew in visitors and provided an incentive to spend, felt especially on big-ticket designer items. Without it, savvy shoppers from the Middle East and the US are favouring cheaper alternatives in rival European centres.
Mulberry’s CEO warned of the impact back in November. Thierry Andretta said that high-end retail in London was becoming “unviable”, leaving boutiques caught between a sluggish recovery from the pandemic and high rents and business rates.
The company’s choice to vacate Bond Street is significant, due the area’s status as London’s hub for tourist shopping.
Mulberry will keep open its other London stores, including its Regent Street flagship an a new outlet at Battersea Power Station, which are more focused on the capital’s permanent residents. Staff from Bond Street, which was open for almost 30 years, will move to other shops. It has 55 in total in the UK.
