Retailers were furious last night after it was revealed the Treasury had dismissed calls to review the hated tourist tax at the upcoming Budget.

Businesses have said the lack of VAT-free shopping has damaged economic growth at a time when firms are grappling with higher costs.

A Treasury source told The Mail on Sunday there were no plans to make mention of the tax in the Budget, despite the lobbying efforts of hundreds of businesses.

Politicians and major household names slammed Chancellor Rachel Reeves for her stubborn refusal to even review the policy.

They said it was a 'no-brainer' to take a second look at Rishi Sunak's much-loathed 2021 move as Chancellor to scrap VAT-free shopping for travellers.

And others said it was 'odd' for Reeves not to heed the calls of businesses, given she is scrambling to find ways to boost economic growth.

It is believed Labour think it is a bad look to offer tax cuts to foreign visitors, despite many firms arguing it would benefit the wider economy.

More than 500 business leaders have backed The Mail on Sunday's campaign to bring back the refund scheme, arguing it would encourage tourists to visit the UK.