It's got nothing to do with duty free booze and fags!
It's about the things you buy in the likes of Boots, WH Smith etc. so if you need to buy some sun cream and you are flying outside of the EU you should pay 20% less for it.
That is why they ask to see your boarding card for everything you buy they log your flight and if it non EU claim back the VAT whereas, in fact, they should reduce the price to the customer by the 20%.