UK airport VAT scam
The airside 7-11s in Singapore sell GST free to passengers who are all international, but airport staff pay 7% tax as per a normal shop on the basis that their purchases aren't leaving the country.
Seems fair enough, the amounts involved aren't much as it's only a convenience store selling sweets, snacks, soft drinks etc.
Seems fair enough, the amounts involved aren't much as it's only a convenience store selling sweets, snacks, soft drinks etc.
There is absolutely no reason (other than greed) why, in this day and age, airport retail outlets should not be able to implement a dual pricing structure that allows them to pass on the VAT savings to customers who are bound for destinations outside the EU.
Of course the retailers would have to come up with a suitable name for the scheme. Hang on, perhaps they could call it "duty-free".
Of course the retailers would have to come up with a suitable name for the scheme. Hang on, perhaps they could call it "duty-free".
What are the prices like at the exit customs points at various airports? Last time I passed through T3 you could buy 2 x 1litre Baileys for £22 after clearing customs.
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Duty Free?
I have long ago stopped buying at Duty Free outlets in airports… I suspect that if more people knew what a Duty Free price really should be, they would stop too…
When our illustrious Chancellor of the Exchequer announced a reduction in duty on Scotch whisky in this year’s budget, The Scotsman newspaper obligingly gave some illustrative numbers:
So if that bottle was sold Duty and VAT free it would be sold at £3.01; a price that includes all the wholesale and retail margins.
Anyone able to buy a 70cl bottle of Scotch for three quid at their airport? Sounds like it’s only those at sea with Grey Funnel Line who might get that proper price.
Two other observations. Firstly, long may those foolish enough to imagine that Duty Free shops offer enormous bargains continue to patronise them, as the vast margins flow back via franchise and other fees to the airport operators who thereby don’t have to keep racking up their landing fees. If Duty Free sales to the foolish dried up, we’d all be paying higher ticket prices. And secondly, I observe that most of the brands of spirits sold these days are ‘premium’ brands rather than the ‘cooking’ brands that one might buy at one’s local supermarket, and thus it’s almost impossible to compare prices. Go figure.
When our illustrious Chancellor of the Exchequer announced a reduction in duty on Scotch whisky in this year’s budget, The Scotsman newspaper obligingly gave some illustrative numbers:
Duty payable on a 70cl bottle of Scotch whisky at the average price of £12.90 has been reduced by 16p, from £7.90 to £7.74, with the total tax burden, including VAT, now standing at £9.89, or 77 per cent of the average price of a bottle, down from 78 per cent.
Anyone able to buy a 70cl bottle of Scotch for three quid at their airport? Sounds like it’s only those at sea with Grey Funnel Line who might get that proper price.
Two other observations. Firstly, long may those foolish enough to imagine that Duty Free shops offer enormous bargains continue to patronise them, as the vast margins flow back via franchise and other fees to the airport operators who thereby don’t have to keep racking up their landing fees. If Duty Free sales to the foolish dried up, we’d all be paying higher ticket prices. And secondly, I observe that most of the brands of spirits sold these days are ‘premium’ brands rather than the ‘cooking’ brands that one might buy at one’s local supermarket, and thus it’s almost impossible to compare prices. Go figure.
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Thread Starter
Also in the article I linked to:
If I recall correctly,UK Duty Free used to have dual pricing?
Another popular airport franchise that requires boarding cards to be shown is WHSmith. While books and magazines do not attract VAT the company confirmed it did not pay the tax on other products and claimed duel pricing was a “practical impossibility”.
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T250:
Many of us would like to believe this, but experience appears to show that airport managements think otherwise.
The planes are just a gimmic to get the punters in.
And to many others ;
Taking 20%VAT off the price of something would result in a reduction of 16.666% (one sixth), not 20% (one fifth).
Airports are for travelling, not shopping
The planes are just a gimmic to get the punters in.
And to many others ;
Taking 20%VAT off the price of something would result in a reduction of 16.666% (one sixth), not 20% (one fifth).
Last edited by Dairyground; 10th Aug 2015 at 00:46. Reason: Originally hit a key one place the left of that intended
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Dual pricing is not a practical impossibility, even Bob's nephew could do it. Their are cash systems around here that will give you a choice of euros or francs.
Dual signage would be more difficult, but hardly.
No, price everything free of VAT with a big sign that says VAT will be added for customers with boarding cards for EU destinations. The American/Canadian cousins do this everyday with their sales taxes.
Dual signage would be more difficult, but hardly.
No, price everything free of VAT with a big sign that says VAT will be added for customers with boarding cards for EU destinations. The American/Canadian cousins do this everyday with their sales taxes.
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One issue might be if locals buy something, even if going outside EU, it would not really be exported.
If you buy a new camera while flying out, you will most probably bring it back into the country.
If you buy a new camera while flying out, you will most probably bring it back into the country.
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What are the prices like at the exit customs points at various airports? Last time I passed through T3 you could buy 2 x 1litre Baileys for £22 after clearing customs.
I would imagine that they need to offer prices like that to sell anything at all.
In any event, those land-side shops operate under precisely the same tax regimes as any high street shop. It makes no difference that they located at the exit of, but not in, the Arrivals area.
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Cabot,
At the shop at Geneva, just before baggage claim, prices remains free of Swiss VAT and, perhaps, other Swiss excise taxes. But 95% of all flights into Geneva are international. (And if you can't provide a boarding card for an int'l flight - you are out of luck) (This does not mean that the prices are any cheaper - this is Switzerland!)
But the same principle should apply to these shops at EU airports. If you are arriving from a non-EU country you should be paying the price free of VAT (and some excise taxes), but if you are coming in from another EU country you pay full whack!
If AMS can have duel pricing (thanks farci) why can't LHR?
Any other EU airports do dual pricing? We should be supporting those.
At the shop at Geneva, just before baggage claim, prices remains free of Swiss VAT and, perhaps, other Swiss excise taxes. But 95% of all flights into Geneva are international. (And if you can't provide a boarding card for an int'l flight - you are out of luck) (This does not mean that the prices are any cheaper - this is Switzerland!)
But the same principle should apply to these shops at EU airports. If you are arriving from a non-EU country you should be paying the price free of VAT (and some excise taxes), but if you are coming in from another EU country you pay full whack!
If AMS can have duel pricing (thanks farci) why can't LHR?
Any other EU airports do dual pricing? We should be supporting those.
ExXB
Total common sense - it'll never catch on in rip-off Britain!
No, price everything free of VAT with a big sign that says VAT will be added for customers with boarding cards for EU destinations. The American/Canadian cousins do this everyday with their sales taxes.
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Passengers are revolting!
“If airport shops aren’t going to pass on their VAT saving, we should refuse to show our boarding cards."
Link to article in today's Independent newspaper:
Air travellers refusing to show boarding passes at airport shops after news that the information is used by stores to avoid paying VAT - Home News - UK - The Independent
Link to article in today's Independent newspaper:
Air travellers refusing to show boarding passes at airport shops after news that the information is used by stores to avoid paying VAT - Home News - UK - The Independent
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Shocked
I am shocked it took so long for the travelling public to realise what a rip off it all is be it Duty Free or not. Last time in OSL for the day - I checked the price of Cafe Creme mini cigars at LGW. A tin of 20 cigars x 5 tins was 36GBP. In OSL it was 28EUR.........luckily I bought then in OSL. Norway being outside the EU and true Duty Free ! Bizarre ! I have not bothered buying anything at all when passing through London`s finest aiports. The whole experience is awful. Walking through some winding yellow brick road through a shopping mall and try to get to the end to where the gates are. And glancing as to the pricing thinking it is cheaper on line and it gets delivered to your door !
Avoid all so called Duty Free at London Airports or be prepared to be shaked down.
Avoid all so called Duty Free at London Airports or be prepared to be shaked down.
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Don't forget, it is not just the shops. On board sales on flights to cities outside the EU have exactly the same prices as flights within the EU. They too are ripping you off.
Some airlines offer duty-free sales on some goods on these flights, but the cost of buy-on-board remains the same.
I don't accept the argument duel pricing is too difficult. Simples, take 16.6% off the gross price. My phone has got a calculator and I can figure that out in a second.
Some airlines offer duty-free sales on some goods on these flights, but the cost of buy-on-board remains the same.
I don't accept the argument duel pricing is too difficult. Simples, take 16.6% off the gross price. My phone has got a calculator and I can figure that out in a second.
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My experience to date:
[locate item to buy, hand it over, proffer means of paying]
"Can I see your boarding pass?"
"I'm sorry, I don't have it handy"
[transaction completes. Sometimes they ask where you're flying to].
I think on one occasion when I was feeling particularly grumpy I just said "no". That was fine too.
This is UK airports. I've never been daft enough to buy anything at Geneva.
[locate item to buy, hand it over, proffer means of paying]
"Can I see your boarding pass?"
"I'm sorry, I don't have it handy"
[transaction completes. Sometimes they ask where you're flying to].
I think on one occasion when I was feeling particularly grumpy I just said "no". That was fine too.
This is UK airports. I've never been daft enough to buy anything at Geneva.
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Thread Starter
There are two letters about the VAT scam in The Independent today. There may be some in other papers but this is the one I read: Rather than quoting them, this link is to the online page as I presume they are copyright. Scroll down past Corbyn and others to the sub headline 'VAT rip-off at the airport'
Letters: Jeremy Corbyn, the Labour recruitment tool - Letters - Voices - The Independent
Letters: Jeremy Corbyn, the Labour recruitment tool - Letters - Voices - The Independent