UK. Three leading trade bodies have joined forces to urge the UK government to reverse its recent announcement on the cessation of tax free sales for all goods other than alcohol and tobacco.
As reported, the UK government has announced tax free sales on airside products for all categories (except alcohol and tobacco) will end for all international travellers from 1 January 2021 at an estimated cost of £2.1 billion to the UK economy.
Airports Council International (ACI) World Director General Luis Felipe de Oliveira, Tax Free World Association (TFWA) President Alain Maingreaud and Duty Free World Council (DFWC) President Sarah Branquinho have all put their names to a letter to UK Chancellor Rishi Sunak demanding a rethink.
“As the global representative organisations for the airports, airlines and duty and tax free retail industry, we urge you to reconsider this proposal, which is very much out of step with common practice in practically all international airports across the globe,” they say in the letter dated 28 September.
They add that UK airports will be “at a major competitive disadvantage vis-à-vis other European airports and international peers” if the new policy is enacted.
Branquinho commented: “Unilateral decisions by individual governments on air transport-related matters – including duty free regulations – cannot be taken without considering the global industry as a whole. The UK government’s decision to end tax free sales is an unnecessary blow as airport retailers face the worst crisis ever to impact the aviation industry.”
Maingreaud pointed out the policy would heavily impact the profitability of the sector as the UK has the largest market in the world for international airport passenger traffic. “As every international journey involves another origin or destination point outside of the UK, the removal of tax free sales will simply lead to unfavourable economic outcomes not only for the sector but the UK as a whole,” he said.
De Oliveira added: “The aviation industry will be a key driver of the UK’s economic recovery from the COVID-19 pandemic but this decision by the government puts this recovery at risk. We urge the UK government to reverse this ill-advised decision as it threatens the already perilous financial state of the airport industry with UK airports standing to lose hundreds of millions of sales, placing thousands of jobs at risk.”
