The number of Chinese visitors to the UK in 2025 was only 82% of 2019 levels, the Association of International Retail said.
Spain saw a much higher rate of Chinese visitors, at 121% of their 2019 levels.
Tourists from outside the EU were eligible to receive a VAT refund on items bought in the UK, making purchases around 20% cheaper, but this was removed in 2021.
Visitors are now choosing to spend money in other European cities such as Paris, Milan and Berlin rather than in the UK.
The Mail reported that 500 firms have backed its campaign for the government to “Scrap the Tourist Tax” and boost the economy.
It added that names such as Giorgio Armani, Pernod Ricard and the owner of the Westfield shopping centres, said that the benefits of getting more visitors to the UK outweigh the cost of the VAT refunds.
“Visit Britain states that shopping is the number one priority for Chinese travellers, yet we have made ourselves a significantly less attractive place to come and spend.
“This isn’t just hitting retailers, but everyone involved in the tourist economy – hotels, restaurants, pubs, visitor attractions, transport and so on.
“All we are asking for is that the government agrees to a proper review of the impact across the economy of ending tax-free shopping. Any government serious about jobs and growth would agree to look at this.”
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