UK. The UK Travel Retail Forum has repeated its call for the government to introduce arrivals duty free as a support measure for the airports sector. It comes against the backdrop of an announcement today that Doncaster Sheffield Airport is to close next month. Owner Peel Group said the move was due to a “fundamental lack of financial viability”.
In response, UK Travel Retail Forum Chair Nigel Keal said: “Today’s sad news is a reminder that even though life is returning to normal, the devastating effects of the COVID pandemic are still being felt by airports up and down the United Kingdom.”
“For smaller regional airports like Doncaster, every penny of revenue is important. As flight numbers return to pre-COVID levels, the contribution of non-aeronautical revenue such as duty free and travel retail can be immense. For some airports duty free and travel retail sales can account for as much as 35% of total revenue.
“And, independent economic studies on the potential of arrivals duty free have concluded they could contribute new sales equivalent to 20-30% of the outbound duty free market, or approximately £100 million each year in new sales.”
He added: “We welcome the recent comments of the Prime Minister on the importance of regional airports to economic growth, and the need to protect them. In addition to the Government’s previously announced intention to return tax free shopping, which we welcome, a simple step to support our airports would be to introduce duty free stores for arriving international passengers.
“These simple but powerful policy concepts can be implemented at next to no cost, and will ensure our airports can compete with their counterparts in the European Union and further afield.”
Earlier, Peel Group had announced that a strategic review of Doncaster Sheffield Airport had concluded. It stated: “Regretfully, no tangible proposals have been received regarding the ownership of the airport or which address the fundamental lack of financial viability. The high fixed costs associated with running a safe, regulated airport, together with recent events materially reducing prospective future aviation income streams, mean that a break-even business plan cannot be identified for the foreseeable future.”
