This evening (Wednesday 6th September) I will be leading a debate in Parliament calling for the introduction of duty-free shopping on arrival at airports, international rail and ferry terminals in Great Britain.
We know that reinstating duty-free shopping and increasing inbound personal allowances on Brexit has proved popular: our first year outside the bloc saw a 45 per cent increase in sales of duty-free items by UK passengers shopping abroad.
The issue is that British business and airports are not benefiting: without duty-free on arrival, passengers can only spend their increased allowances abroad – at the point of departure.
This is why I am urging Government to introduce duty-free stores on arrival at British airports, international rail and ferry terminals: to ensure that this post-Brexit duty-free system can benefit British-based businesses such as those at Gatwick Airport.
Such stores have already been introduced in 65 countries including major travel hubs in Asia, the Middle East and Oceania. Britain must not be left behind.
Norway introduced duty-free on arrival in 2005 and the impact at Aberdeen Airport was immediate. Sales to Norwegian-bound passengers fell by some 40 per cent, with average spend per passenger halving. Making such purchases on arrival is more convenient for passengers.
Polling commissioned has found that 45 per cent of travellers see having to carry duty-free items to the UK on their flight as an inconvenience, while around two thirds of people would support the Government making such purchases possible in Britain.
It is predicted that the introduction of duty-free on arrivals stores will lead to an increased spend per passenger of between 20-30 per cent, with additional sales of £100 million each year.
As of 2019, such sales in Norway have increased 108 per cent since their implementation, growing consistently at an average rate of more than 10 per cent a year.
Concerns of HM Treasury of an initial loss of excise duties can be assuaged through their offset from other forms of taxation as well as new jobs: Zurich Airport’s introduction of a single arrivals duty-free store led to an additional 50 jobs.
Arrivals duty-free stores would be located before customs clearance and therefore avoid additional staffing or resourcing pressures.
At its heart this is an issue about British competitiveness on the global stage which can provide us with an economic boost here at home.
The introduction of duty-free on arrivals stores would indeed amount to an additional £50 million each year for the Exchequer, which in turn could be deployed in helping support our public services and reducing income tax.
This is a change the UK Government can easily make to enhance the aviation, travel and tourism sectors both locally and throughout the nation.
Henry Smith MP
