Air travellers refusing to show boarding passes at airport shops after news about VAT avoidance

ubersonic · 12 Aug 2015 at 10:50

I love how angry some of the posters in the comments are, one day they will realise they pay VAT on fuel duty and implode XD

SiD the Turtle · 12 Aug 2015 at 10:54

VAT is a funny thing anyway. For small businesses the VAT you have to give to the tax man varies based on your type of business and is rarely 20% meaning they do pocket the difference: https://www.gov.uk/vat-flat-rate-scheme/vat-flat-rates. Of course this doesn't employ to the big boys at airports as their turnovers would be too high.

If I understand correctly what they're saying in airports is the price is higher if you're not going to the EU.

Travelling to the EU? That bottle of water is £1, plus 20p in VAT.
Travelling outside the EU? That bottle of water is £1.20, VAT free.

If it was the other way around I'm sure EU investigators would be complaining.

Belly · 12 Aug 2015 at 10:59

Efour said:
Duty free prices are about inline with a normal UK Tesco or ASDA high street supermarket...

Its all a big ruse.

We go abroad at least twice a year (Africa/India). The advantage for us is that we wouldn't pass security with that amount of liquids in our hand baggage and if we bought from Tesco etc we'd have to store them in our hold baggage with the worry of breakages.

Last holiday Jun 15: One litre 8 year (??) old Bushmills and one litre Tanqueray Gin at Manchester Airport for £26 going out (both consumed on holiday), cheaper options available. Returning - two litres of Gordon's Gin in rectangular plastic bottles £22 purchased on the plane.

At the airport in Goa (India) one can buy duty free on arrival, as you say prices are similar to that of Tesco etc

Vulcan · 12 Aug 2015 at 11:00

One More Solo said:
VAT at 20% is in line with most of the EU.

Yup, the UK is in fact at the lower end of the scale: https://en.wikipedia.org/wiki/Value-added_tax#Tax_rates

Joint 19th across the EU.

dowie · 12 Aug 2015 at 11:04

Belly said:
Are these correct examples:

A traveller flying to a destination outside the EU purchases £12 worth of suntan lotion and shows his boarding pass. The seller does NOT pass on the £2 in VAT to the UK treasury? If he refused to show his boarding pass £2 would have to be sent to the treasury?

Another traveller travelling within the EU also buys £12 worth of suntan lotion, shows his boarding pass and £2 would then be "sent" to the treasury?

Yup, for some places like boots etc... that is correct. For other places advertising duty free shopping they'll pass on the savings to people going outside the EU.

It is a bit cheeky as duty free has been around for a while - tis a deliberate move on the part of these retailers to charge more to travellers going outside the EU.

Etheco · 12 Aug 2015 at 11:04

So i no longer have to faff around finding my boarding pass when buying a silly expensive drink.

Schlong&Stable · 12 Aug 2015 at 11:10

Etheco said:
So i no longer have to faff around finding my boarding pass when buying a silly expensive drink.

Indeed. I couldn't give a hoop about whether the shop is making 20% more or not. I saw the price and was willing to pay it, enough said. But having to rummage around for my boarding card when I often have my hands full is a pain in the arse.

Belly · 12 Aug 2015 at 11:27

dowie said:
Yup, for some places like boots etc... that is correct. For other places advertising duty free shopping they'll pass on the savings to people going outside the EU.

It is a bit cheeky as duty free has been around for a while - tis a deliberate move on the part of these retailers to charge more to travellers going outside the EU.

Thanx for that info. So it seems to be that if a plane load of people, say 300 Japanese tourists returning to Japan spend £50 each on luggage, MU T Shirts etc and all show their boarding passes that the treasury would have lost out on £2500? The £2500 would be pocketed by the retailer? If there were 301 on board and one guy refused to show is boarding pass and spent £50 the treasury would receive £8.33?

I'm very surprised that the government hadn't cottoned on to this years ago rather than leaving it to customer pressure, (unless MPs have interests in such retail outlets)? After all purchasers with our without boarding passes pay the same.

neil_g · 12 Aug 2015 at 11:32

Richdog said:
Please feel free to explain in detail why what I wrote isn't true in the context of this thread.

im not sure i can give specific examples without risking my job if my employer saw. if i get time later i'll give it a go.

but as i say, i dont think its as straight forward as calling it a "scam". thats coming from a decade working in retail systems (granted ive stepped away from epos in the last 3-4 yrs).

dowie · 12 Aug 2015 at 11:58

Belly said:
Thanx for that info. So it seems to be that if a plane load of people, say 300 Japanese tourists returning to Japan spend £50 each on luggage, MU T Shirts etc and all show their boarding passes that the treasury would have lost out on £2500? The £2500 would be pocketed by the retailer? If there were 301 on board and one guy refused to show is boarding pass and spent £50 the treasury would receive £8.33?

I'm very surprised that the government hadn't cottoned on to this years ago rather than leaving it to customer pressure, (unless MPs have interests in such retail outlets)? After all purchasers with our without boarding passes pay the same.

The govt agreed to it... duty free has been around for a while it isn't just a UK thing - tis standard at international airports around the world to not pay local sales taxes. It is the passengers that are losing out by being charged extra when flying outside the EU instead of simply having a discount due to the VAT not applying.

Richdog · 12 Aug 2015 at 11:59

neil_g said:
im not sure i can give specific examples without risking my job if my employer saw. if i get time later i'll give it a go.

but as i say, i dont think its as straight forward as calling it a "scam". thats coming from a decade working in retail systems (granted ive stepped away from epos in the last 3-4 yrs).

Maybe not a scam, but it is wilful deception.

dowie · 12 Aug 2015 at 12:02

Calling it a scam/conspiracy isn't unwarranted. It isn't exactly super complicated to just not apply VAT...and some duty free shops still exist.

Scougar · 12 Aug 2015 at 12:32

Wow... I had assumed it was some weird legal thing so always showed my boarding card. Given airport shops are generally darn expensive this is just a joke.

Surfer · 12 Aug 2015 at 13:29

retailers being greedy baskets shocker.

CJonny · 12 Aug 2015 at 14:31

Well that was enlightening. I guess the uproar will begin and they will either scrap the system or pass the savings on to the customer. I wonder which one they will choose?

FutileBreadMachine · 12 Aug 2015 at 14:37

Like a lot of people I thought it was a security thing. I even reached the front of a queue at Boots in an airport and was told I couldn't buy the items I had because I forgot to bring my boarding pass with me, so I had to leave the shop to go back to my wife and get my boarding pass, then come back and pay.

Now I find out it's just so they can make more money on that VAT! Dodgy *******!

Scougar · 12 Aug 2015 at 15:18

FutileBreadMachine said:
Like a lot of people I thought it was a security thing. I even reached the front of a queue at Boots in an airport and was told I couldn't buy the items I had because I forgot to bring my boarding pass with me, so I had to leave the shop to go back to my wife and get my boarding pass, then come back and pay.

Now I find out it's just so they can make more money on that VAT! Dodgy *******!

I always found it utterly bizarre as well, given that you were already in the waiting area... and assumed it was a security/legal thing. As you, now I know it is totally unwarranted I find it annoying. However, the staff were likely probably not aware of this themselves, or they had been instructed to refuse service without a card or lose their job (I make quite an assumption here).

tom_e · 12 Aug 2015 at 15:22

Retail staff will just get treated like mushrooms as usual fed **** and kept in the dark, they'll have just been doing as instructed by their boss who for the most part was probably just doing as they were told by their boss until you actually get high enough to reach someone who has a clue.

gradyhawks · 12 Aug 2015 at 15:51

Only thing I have ever found that is cheaper at air ports, at least UK ones, are the occasional bottle of spirit. Everything else is more expensive....

FutileBreadMachine · 12 Aug 2015 at 16:00

Scougar said:
I always found it utterly bizarre as well, given that you were already in the waiting area... and assumed it was a security/legal thing. As you, now I know it is totally unwarranted I find it annoying. However, the staff were likely probably not aware of this themselves, or they had been instructed to refuse service without a card or lose their job (I make quite an assumption here).

Yeah I assume the people at the till were just told they had to check boarding passes as a matter of course and didn't question why, or their manager just told them that's the rule.