UK airport VAT scam
Paxing All Over The World
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Your predictive text was right, ExXB. it must have been thinking about UK airports and went into fighting mode. (terrible attempt at humour, I'll get my hat)
Paxing All Over The World
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The story has also reached The Daily Telegraph
Airport VAT revolt: Thousands refuse to show boarding passes to shops - Telegraph
and today The Indy states:
Airport VAT scam: Treasury ministers demand an end to rip-off charges as grassroots passenger rebellion gathers pace - Home News - UK - The Independent
Airport VAT revolt: Thousands refuse to show boarding passes to shops - Telegraph
and today The Indy states:
Airport VAT scam: Treasury ministers demand an end to rip-off charges as grassroots passenger rebellion gathers pace - Home News - UK - The Independent
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I never buy from any airport "duty-free" shop. I buy duty-free in-flight. Just do a price comparison. If I want some newspapers or chocs for the flight I get them at the bus station shop prior to heading to the airport. All other products should be purchased long before your flight. It involves planning. No big deal. Try a local pound store. Why you would wait until you got to the airport to get your precious moisturizer, I cannot fathom. I dislike with a passion the layout of so called duty-free shops after passing security - it's just a time wasting trap for the gullible.
At one period in my career I was involved in my airline's duty-free products operations. This was mid 80's. A miniature of scotch cost us $0.18 for duty-free sales.
At one period in my career I was involved in my airline's duty-free products operations. This was mid 80's. A miniature of scotch cost us $0.18 for duty-free sales.
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Some 40 years ago, I had my first experience of "international" travel , - Ferry to the Irish republic. Iwas curious about the fabled "duty -Free" and duly investigated.
Savings were minimal, so I didn't bother.
On my next trip, I bought the maximum allowable, to take into the Republic, having previously established that spirits in the Republic , were about 3X "duty-free"price.( IIRC, allowance was 4 bottles)
My favoured customers were delighted with their gifts. Me- I returned to UK empty-handed.
buyer beware, indeed....you won't get me fighting over duel pricing, or even finding me debating the savings on dual pricing.
I resolutely refuse to pay "ransom" prices in any "closed" situation such as Events catering and drinks, airports, docks etc.
Yes, I'm tight and make sure that i'm not exploited by the greedy and unethical.
Savings were minimal, so I didn't bother.
On my next trip, I bought the maximum allowable, to take into the Republic, having previously established that spirits in the Republic , were about 3X "duty-free"price.( IIRC, allowance was 4 bottles)
My favoured customers were delighted with their gifts. Me- I returned to UK empty-handed.
buyer beware, indeed....you won't get me fighting over duel pricing, or even finding me debating the savings on dual pricing.
I resolutely refuse to pay "ransom" prices in any "closed" situation such as Events catering and drinks, airports, docks etc.
Yes, I'm tight and make sure that i'm not exploited by the greedy and unethical.
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"The government should make it illegal for airport shops to keep VAT savings for themselves rather than passing them on to customers, the Retail Ombudsman has said. It follows news that some airport shops are reclaiming VAT relief intended for shoppers flying to non-EU countries after checking their boarding passes.
Ombudsman Dean Dunham said there was little he could do as the law stands.
Retailers have said they are following government rules.
Passengers are asked to show passes so retailers can identify who is flying to non-EU countries and avoid paying 20% VAT on customers' purchases.
Treasury minister David Gauke said the relief was intended to reduce prices for travellers, not be a windfall gain for shops." bbc
Sorry for waking you from your extended naps Dean and David.
Ombudsman Dean Dunham said there was little he could do as the law stands.
Retailers have said they are following government rules.
Passengers are asked to show passes so retailers can identify who is flying to non-EU countries and avoid paying 20% VAT on customers' purchases.
Treasury minister David Gauke said the relief was intended to reduce prices for travellers, not be a windfall gain for shops." bbc
Sorry for waking you from your extended naps Dean and David.
Paxing All Over The World
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I didn't think the story could continue to get any stupider but then, Corporate bosses are known for it ...
Whaaaaat?? 
Airport VAT scam: WHSmith, Boots and Dixons 'reminding' staff of boarding pass rules - News & Advice - Travel - The Independent
But now three of the big companies at the centre of the outrage have suggested they have never instructed staff to demand to see customers’ boarding passes.
Airport VAT scam: WHSmith, Boots and Dixons 'reminding' staff of boarding pass rules - News & Advice - Travel - The Independent
Last edited by PAXboy; 13th Aug 2015 at 09:23.
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But now three of the big companies at the centre of the outrage have suggested they have never instructed staff to demand to see customers’ boarding passes.
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If something is advertised as "tax free" and it is not sold as such, and charging the VAT, any of it, means it's not tax free, it would be the criminal offence of fraud, see the Fraud Act 2006. It would be a false representation with a view to gain or cause loss to another under section 2. This has to be done dishonestly of course. And if they didn't know it then, now they most certainly do know it is dishonest.
As for Duty this is different and is a Customs matter and my understanding is it is levied on the usual suspects ie booze, fags and perfume. I understand there is a HMRC requirement for the seller to ensure the passenger is leaving the EU, hence the boarding card must be produced.
Like a lot of posters here I have noticed the absurd high pricing in UK airports so these days I only buy water and a paper and occasionally a whisky I particularly want which is not available on the High Street.
As for Duty this is different and is a Customs matter and my understanding is it is levied on the usual suspects ie booze, fags and perfume. I understand there is a HMRC requirement for the seller to ensure the passenger is leaving the EU, hence the boarding card must be produced.
Like a lot of posters here I have noticed the absurd high pricing in UK airports so these days I only buy water and a paper and occasionally a whisky I particularly want which is not available on the High Street.
Goods sold to passengers bound for non-EU destinations (with the boarding card as the evidence HMRC requires) are being sold tax-free, in that the retailer doesn't have to hand over one-sixth of the sale price as VAT to the Chancellor. The issue is that the retailer, instead of reducing the sale price accordingly to reflect the fact that there's no VAT element, simply charges the same as the VAT-inclusive price and pockets the 20% as extra profit.
Disingenuous, yes. Illlegal, almost certainly not.
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Just a little point to make. Most UK airports only make any money from duty free/parking/food out lets, as the airlines especially LOCO pay naff all in the way of landing charges. Just be careful what you wish for, as the big shinny birds which we all think are so important to an airport actually often generate little income. It is the shops/food/parking which finance these places. I have built a number of these world wide and you would be amazed on the amount of time and effort that goes into those 3 aspects of airport design in comparison with gates and runways etc. The designs at Man are already concentrating on retail space even at this early stage and this will dictate the look of the new terminals. For those who do not pay for anything at the airport good luck to you, I my self usually get Private Eye and coffee if not in a lounge but if every passenger limited their spend you would see many regional airports closing. To show how important this is look how airports will try hard to get bucket and spade flight to the canaries islands due to there Tax status which airports know from sales modelling generate more duty free sales than flights to many other European destinations. I know this as my wife was in quite a senior position for a large world wide aviation group, with a number of airports world wide some of which were in the UK. As she used to say to me its about foot fall through shops and parking for cars and based A/C, that,s where the money is.
There's an advert in today's Telegraph from the airport authority showing a comparison with high street prices and how much you can save at Heathrow.
I remember back in the 1990s they had to run an advertising campaign after being caught selling "Duty Free" whisky for more than it cost in a supermarket.
Back in those days TV and newspapers were the main source of news, these days with social media and stories going viral everybody knows within a day or two.
With VAT at 20% we're not talking about rounding up a few pennies. Many shops in London have the tax free for tourists scheme and if your spending passes the threshold you can claim back the tax less an admin charge. You may need to reduce the number of shops you purchase from to keep individual receipts high enough and allow extra time at the airport, but you can shop at your leisure and have a far greater selection.
I remember back in the 1990s they had to run an advertising campaign after being caught selling "Duty Free" whisky for more than it cost in a supermarket.
Back in those days TV and newspapers were the main source of news, these days with social media and stories going viral everybody knows within a day or two.
With VAT at 20% we're not talking about rounding up a few pennies. Many shops in London have the tax free for tourists scheme and if your spending passes the threshold you can claim back the tax less an admin charge. You may need to reduce the number of shops you purchase from to keep individual receipts high enough and allow extra time at the airport, but you can shop at your leisure and have a far greater selection.
Paxing All Over The World
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Aboslutely, Mr Mac. I agree that they have to make their money but it is the deception that is galling.
I also lay the blame on the govt that did the privatisation. They wanted to pretend that you could keep prices down by setting an unrealistic control. This was usual of govts as they said they wanted to privatise but then they also wanted to control and show themselves to be 'looking out' for the punter. Consequently, rental from shopping space became the big earner and, no surrprise, the corporates had to find ways of coming up with the cash.
Since all that happened 30 years ago - the media have 'forgotten' what was done. But, of course, not much will change.
I also lay the blame on the govt that did the privatisation. They wanted to pretend that you could keep prices down by setting an unrealistic control. This was usual of govts as they said they wanted to privatise but then they also wanted to control and show themselves to be 'looking out' for the punter. Consequently, rental from shopping space became the big earner and, no surrprise, the corporates had to find ways of coming up with the cash.
Since all that happened 30 years ago - the media have 'forgotten' what was done. But, of course, not much will change.
To advertise a "SALE" price in the high street, the goods must have been offered at a higher price for a continuous period of twenty eight days within the last six months.
The term "DUTY FREE" is highly misleading as it implies that the item is being sold for a price significantly lower than normal as no duty is being charged.
To qualify to be advertised "DUTY FREE" the goods should be offered at normal retail price less the amount of duty which would be charged if they were sold land side.
I have no objection to shops selling alcohol and cigarettes at the airport but unless the whole saving is being passed on to the customer the "DUTY FREE" signs should come down. Instead let them give comparison prices with the high street instead to show what savings if any are being made.
The term "DUTY FREE" is highly misleading as it implies that the item is being sold for a price significantly lower than normal as no duty is being charged.
To qualify to be advertised "DUTY FREE" the goods should be offered at normal retail price less the amount of duty which would be charged if they were sold land side.
I have no objection to shops selling alcohol and cigarettes at the airport but unless the whole saving is being passed on to the customer the "DUTY FREE" signs should come down. Instead let them give comparison prices with the high street instead to show what savings if any are being made.
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I think there are three types of shops/services airside and different rules apply.
Bars/Resturants who sell goods for consumption on-site. Prices for these goods are not free of excise duty or VAT. They do not claim to be 'duty free'.
Shops selling Booze, nicotine fixes and Perfumes. These goods, if exported from the EU, are offered as 'duty free'. If so, it is required to prove you are leaving the EU. Showing your boarding card is mandatory. It may be possible to purchase these goods for EU travel but the taxes are added on. It is not necessary to show your boarding card. These shops claim to be 'duty free'
Other shops selling other goods. If they can prove the purchaser is leaving the EU the retailer is not subject to the VAT. To prove this the retailer needs to scan your boarding card. However there is no obligation for the passenger to allow this. These shops do not claim to be duty free.
There are hybrids of two and three above, where they claim to be duty free and do sell duty free goods to passengers leaving the EU. Their claim to be duty free is partially correct, but not all goods sold there are duty free.
It is the second group that is ripping us off. Knowingly selling goods at prices inclusive of VAT, when they are not required to remit the tax to the UK authorities if the passenger is exported the goods from the EU.
And then there are the airlines where they maintain a single price for onboard sales for all flights, inclusive of UK VAT, which is charged to all passengers including those on non-EU flights. Often the goods in their boutiques are referred to in the announcement as duty free (and quaintly as 'duty-frees) Now I don't buy on board, primarily because the value for money is nonexistant. But those that do are being royally ripped off.
Bars/Resturants who sell goods for consumption on-site. Prices for these goods are not free of excise duty or VAT. They do not claim to be 'duty free'.
Shops selling Booze, nicotine fixes and Perfumes. These goods, if exported from the EU, are offered as 'duty free'. If so, it is required to prove you are leaving the EU. Showing your boarding card is mandatory. It may be possible to purchase these goods for EU travel but the taxes are added on. It is not necessary to show your boarding card. These shops claim to be 'duty free'
Other shops selling other goods. If they can prove the purchaser is leaving the EU the retailer is not subject to the VAT. To prove this the retailer needs to scan your boarding card. However there is no obligation for the passenger to allow this. These shops do not claim to be duty free.
There are hybrids of two and three above, where they claim to be duty free and do sell duty free goods to passengers leaving the EU. Their claim to be duty free is partially correct, but not all goods sold there are duty free.
It is the second group that is ripping us off. Knowingly selling goods at prices inclusive of VAT, when they are not required to remit the tax to the UK authorities if the passenger is exported the goods from the EU.
And then there are the airlines where they maintain a single price for onboard sales for all flights, inclusive of UK VAT, which is charged to all passengers including those on non-EU flights. Often the goods in their boutiques are referred to in the announcement as duty free (and quaintly as 'duty-frees) Now I don't buy on board, primarily because the value for money is nonexistant. But those that do are being royally ripped off.
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Airports in UK usually don't pay a business rate for lease of premises at an airport departure lounge, they pay a percentage of overall takings.
Therefore, unlikely airport operators will seem interested in this pricing issue as it will likely affect their bottom lines also.
Money makes the world go round
Therefore, unlikely airport operators will seem interested in this pricing issue as it will likely affect their bottom lines also.
Money makes the world go round
Paxing All Over The World
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