A cross-party group of over 60 MPs and Peers have written an open letter to the Chancellor of the Exchequer, calling for the introduction of duty free on arrival shops in British airports, international rail and ferry terminals.
The letter said that independent research from York Aviation showed that the move could increase passenger spend by between 20 and 30 per cent, and would “help our travel sector flourish and take full advantage of the UK’s EU departure”.
Led by Henry Smith MP, chair of the Future of Aviation All-Party Parliamentary Group, the letter said that “Duty free on arrival stores do not contravene international principles of taxation and [have] consequently been successfully deployed around the world in over sixty countries, including by some of our closest allies – Australia and all EEA nations (Norway, Iceland, Switzerland), for example”.
It added that the move would give travel hubs a “helping hand” following the devastating impact of Covid-19, and listed several benefits, including increasing international competitiveness of British airports.
The letter said that “practically all major airports in Asia, the Middle East, Australasia, and non-EU countries in both the European Economic Area and Eastern Europe have introduced arrivals duty free stores in the last two decades”, adding that “We understand that the European Union are additionally considering its implementation of this policy as part of support package for the travel industry”.
It stressed that the introduction of arrivals duty free shops would be cost neutral for governments, as purchases at arrivals duty free stores have no impact on domestic sales of products, and said that the move would support regional development and employment at British airports.
The letter also claimed that such shops would aid carbon abatement by reducing on board passenger weight, as passengers would have the choice to buy on departure or on arrival.
The letter concluded by saying:
“To assist the UK to thrive in a post-Brexit environment, we must ensure we take advantage of all opportunities available to us. The fundamental facet of duty free on arrival stores is that it will not take sales away from the UK’s high street nor will it increase the amount of goods being sold, rather it will repatriate sales that currently take place at the point of departure – mostly likely in the EU in the majority. Passengers arriving in the UK are still subject to the same limits of goods they can carry with them as duty free purchases.
“Regardless of whether this policy is implemented, these products will still be purchased. We view the concept of UK arrivals stores as very much an opportunity to capture duty free sales already taking place abroad, and ensure the economic benefit of those sales are realised in the UK.”
Commenting on the calls Francois Bourienne, chair of the UK Travel Retail Forum, said:
“Duty free on arrival shop should form an integral part of the Government’s support package for our ailing travel industry. The beauty of this initiative is that it will not cost the Government a penny.
“More than tax breaks or grants, the Government should look to self-sustaining measures, such as duty free on arrival shops, which are mindful of the fiscal restraints on our economy and allow the industry to stand on its own two feet and flourish. With the European Union considering such an initiative the UK must follow suit to remain competitive.”