People will travel to Europe to go shopping because Britain no longer offers tax-free purchases to international tourists, the boss of clothing chain Superdry has warned.

Under the VAT Retail Export Scheme, non-EU visitors to the bloc can recover the VAT on High Street purchases.

But the scheme was withdrawn in Great Britain in January 2021 after the UK left the EU.

Julian Dunkerton, who co-founded Superdry, said this was “a blind move”.

“If one goes to Europe, now it’s absolutely heaving – every hotel is full,” he told BBC Radio 4’s PM programme. “Britain on the other hand, is below pre-Covid numbers.”

He warned high-spending international tourists would stop coming to spend money in Britain.

“They’re going to go to France instead of to us to do all that luxury shopping,” he said.

“The other aspect that people haven’t realised is that we as Brits can go to France and if we’re buying any high-ticket item, get a tax-free deal on that product.

“So what we’re going to see, as we saw in I think it was the 80s when people used to do booze cruises, it will be worth getting on a plane, getting on a boat and going to France or going to mainland Europe and doing their shopping.”

The VAT Retail Export Scheme benefitted tourist hotspots like London and Edinburgh, as well as the famous Bicester shopping village in Oxfordshire, which attracts visitors seeking bargains.

When it was withdrawn, the Treasury said it was costly and vulnerable to fraud.

Mr Dunkerton, who was a vocal supporter of remaining in the EU, said Brexit was also “stoking inflation”.

He said if the government didn’t tackle rising prices “we’re going to go down a very difficult path of wages spiralling out of control”.

He called on the government to increase corporation tax to help struggling households in the coming months.

“That money [could] be used to benefit the people that need it through this winter and potentially a VAT decrease to make sure that inflation and wage costs do not get out of control this winter,” he said.

Combined with the windfall tax on oil and gas companies, Mr Dunkerton said the government would then have the money to take VAT off energy bills and potentially reducing it on other products too.

The BBC has contacted the Treasury for comment.

Earlier this year, Superdry said it would increase prices on some of its clothes by around 2% due to inflation.

The brand, which started out as a market stall in Cheltenham, was set up by Mr Dunkerton and James Holder in 2003 and went on to enjoy huge commercial success.

But clashes followed between Mr Dunkerton and the board, leading to his resignation from the board and eventual return in 2019 to “steady the ship” after huge losses.

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