By Aaron Szyf
In an age when online shopping has replaced many in-person purchases at diverse U.S. businesses throughout the country, the full return—and continued growth—of inbound travel is critical for numerous U.S. retailers.
International visitors to the U.S. love to shop and spend money at stores across the country. In fact, according to NTTO’s Survey of International Travelers (SIAT), more than 80% of overseas travelers reported that they engaged in shopping, more than any other activity. The U.S. was—and remains—the “single most popular destination for shopaholics” according to a recent WTTC report. In an age when online shopping has replaced many in-person purchases at diverse U.S. businesses throughout the country, the full return—and continued growth—of inbound travel is critical for numerous U.S. retailers.
By the Numbers: In 2019, shopping accounted for 21% of overseas visitor spending according to NTTO’s SIAT survey. Based on that, we estimate that overseas travelers contributed nearly $25 billion in valuable sales for American retail companies and export income for the U.S. economy.1
- Japan ranked highest in terms of retail’s share of total travel spending in the U.S. (35%), as well as total retail spending during visits to the U.S., which we estimate at about $2.8 billion in 2019.
- China ranked second-highest in terms of our estimates for total retail spending ($2.6 billion).
What else: Retail spending by international visitors does not only benefit American companies and workers, but also helps U.S. taxpayers and communities via sales taxes that foreign shoppers pay in most states.
- An example: New York City typically attracts more than a quarter of all overseas visitors. International visitors spent about $4.4 billion in New York City on retail shopping in 2019. That equated to almost $400 million in sales taxes.2
- When we estimate total sales taxes paid by all overseas shoppers in the U.S., we found that overseas visitors contributed $1.9 billion to state and local economies via sales taxes in 2019. Total international visitors —including Mexicans and Canadians—contributed well over $2 billion.
Why this matters: The slow return of overseas travelers has been difficult on U.S. retailers who rely on their spending. In 2022, overseas retail spending was at roughly half of pre-pandemic levels, a loss of $12 billion. With overseas travel only 73% recovered so far in 2023, we are on track to see an additional loss of more than $6 billion in retail spending this year.
Go deeper: Many U.S. retailers have disclosed that the still-slow return of overseas visitation has been noticeably hurting sales.
- Just last week, Macy’s pointed out that international visitors, which used to account for 3-4% of total sales, now account for less than 2%. The company has invested heavily in its flagship locations in order to attract high-spending overseas visitors, and it—together with retailers at major tourist destinations throughout the country—is eager for the complete return of inbound travel.
The U.S. economy, in conjunction with its retailers, taxpayers, workers and businesses, is in need of a full return of the lucrative overseas travel market.
 This estimate focuses on overseas travelers, which have the highest share of retail spending and which are furthest behind. It is based on survey data from NTTO, which highlights the share of retail spending (available only for Overseas countries) and spending data from the BEA. The value of total international visitor retail spending in the U.S. in 2019, including Canada and Mexico, according to WTTC was $35 billion, though that is calculated differently.
 This calculation, which includes spending by Canadians and Mexicans, is based on international spending data for NYC provided in this report, a NYC retail share of 19% (from NTTO) and a city sales tax rate of 8.875%.