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Airport retailers 'must pass on VAT savings'

13 Aug 2015

Treasury minister David Gauke has called on airport retailers to pass on VAT savings to their customers, following the news that many airport-based shops are currently choosing to keep some or all of the 20% saving applying to goods purchased by those travelling outside the EU.

Many airport retailers ask to see passengers’ boarding cards before payment is made. While passengers often assume that this is for legal or security reasons, passengers are actually only legally required to show their boarding passes when purchasing duty-free cigarettes or alcohol, as proof that they are travelling outside the EU.

However, research conducted by The Independent has revealed that some retailers such as Boots, WH Smith and Dixons are requesting the information in order to claim the VAT exemption, without passing on the savings to their customers.

Mr Gauke told The Independent: ‘The VAT relief at airports is intended to reduce prices for travellers, not as a windfall gain for shops’.

‘While many retailers do pass this saving on to customers, it is disappointing that some are choosing not to. We urge all airside retailers to use this relief for the benefit of their customers.’