LONDON,  (Reuters) - London's luxury retailers fear the city is losing its pull as a shopping destination, with tourists from the United States, China and the Gulf flocking instead to Paris and Milan where tax breaks still offer a way to cut the cost of their purchases.

With finance minister Jeremy Hunt set to present the government's budget statement on Wednesday, the industry wants him to reinstate sales-tax-free shopping for overseas visitors, which ended in 2020 when Britain left the European Union.

Big names including department stores Harrods and Harvey Nichols, Chelsea property manager Cadogan and The Lanesborough Hotel have joined forces with hundreds of retailers to urge Hunt to change the rules.

"We've heard from some brands that they're prioritising Paris for investment in stores," Steve Medway, CEO of the Knightsbridge and King's Road Partnerships, told Reuters in an interview at Harrods, before it opened for the day.