Campaign Begins For U.K. Duty-Free Shopping On Arrival


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While the EU is trading verbal blows with the U.K. over who should get Covid-19 vaccine supplies, 60 British lawmakers wrote to the chancellor Rishi Sunak on Wednesday asking for the introduction of duty-free shopping on arrival in airports, international rail and ferry terminals.

The letter from the cross-party group of parliamentarians comes after the Brussels-based European Travel Retail Confederation launched its campaign for arrivals duty-free on the continent last year. Research from York Aviation, commissioned by ETRC, suggests that the move could deliver $1.5 billion in EU tax revenue by 2024.

“With the European Union considering such an initiative the U.K. must follow suit to remain competitive,” says Francois Bourienne, chair of the U.K. Travel Retail Forum, a British duty-free and travel retail membership organization.

Brexit enabled the U.K. to reintroduce duty-free sales to EU countries from January 2021 which will boost sales for airport retailers once travel picks up. From the same month the British government also increased the allowances for those travelers coming back from the EU which should help drive the sales of continental travel retailers.

Having arrivals duty-free shopping on either side of the English Channel has the effect of keeping transactions in the country of origin—it is more convenient to buy heavy items such as bottles of spirits when returning from a trip than at the departure airport.

In a statement, UKTRF notes: “Arrivals stored would represent a repatriation of sales that currently take place at the point of departure—mostly likely in the EU. We view the concept of U.K. arrivals stores as very much an opportunity to capture duty-free sales already taking place abroad, and ensure the economic benefits are realised in the U.K.”

Repatriating spending

The joint petition to Sunak from the 60 lawmakers states that arrivals duty-free stores would “increase passenger spend by between 20-30%” based on York Aviation data. Henry Smith, the MP who organized the letter and who is also the chair of the Future of Aviation All-Party Parliamentary Group, says: “As we look ahead to a post-Covid environment, it’s vital that the government explore innovative ways of helping the sector not only recover but grow.

“Duty-free on arrival stores not only help the industry recover in the short-term by providing jobs, kick-starting investment and bringing global passenger spend to the U.K., but will set it up for the future—delivering a future-proofed sector that can support our global agenda.”

Bourienne also points out that this initiative won’t cost the taxpayer anything. “More than tax breaks or grants, self-sustaining measures such as duty-free on arrival shops allow the industry to stand on its own two feet and flourish,” he says.

The UKTRF adds that the initiative “would not have a material impact” on retailers in the U.K.’s domestic market because “the sales made at arrivals stores are not already taking place in the UK economy.”

Instead the impact will be felt at airports in EU countries where Brits are a major source of travelers—leisure in particular. They include France and Italy, where Lagardère Travel Retail is a key operator, and in Spain where Dufry dominates. However, in both cases, what they lose in the EU they can gain—to differing degrees—in the U.K. as both retailers also run stores at large British airports.

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