A report commissioned by the European Travel Retail Confederation (ETRC) has found that there are potentially huge economic benefits to be achieved through the introduction of arrivals duty and tax free shopping at EU airports. Alongside Airports Council International (ACI) Europe, ETRC is calling on the European Union to review current legislation to allow passengers travelling from third countries to buy duty and tax free on arrival in EU airports.

“The introduction of EU arrivals duty and tax free shopping presents us with a great opportunity to renew the outdated approach to arrivals shopping in the EU,” offered ETRC President, Nigel Keal alluding to the fact that arrivals duty and tax free shops are commonplace in airports around the world including all European Economic Areas (EEA) such as Norway and Switzerland. But under current EU legislation, only those passengers ‘leaving’ the EU are allowed to purchase duty and tax free sales. Allowing such sales for arriving passengers travelling from third countries to the EU will help restore competition for EU airports with their international counterparts, by creating much-needed revenue and supporting employment at EU airports.

“As allowances will remain the same, this proposal will simply give passengers another opportunity to avail of their duty and tax free allowance and to choose to support their local airport rather than buy abroad,” Keal continued.

Findings in the report reveal that based on 2019 traffic figures, duty and tax free arrival shops would have generated around €4.3 billion in Gross Value Added (GVA), supported 41,500 jobs and generated €1.6 billion in tax revenues. The report also estimates that arrivals duty and tax free sales could generate up to 30% of total travel retail sales at EU airports.

Recognising the impact of COIVD-19 on air traffic, the report draws the conclusion of an initial impact per million passengers of around €1.3 billion in GVA, 12,100 jobs and €475 million in tax revenues, rising to €3.5 billion in GVA, 33,700 jobs and €1.3 billion in tax revenues. What’s more, with the UK’s transition period for Brexit coming to an end this year, the numbers of non-EU passengers is expected to increase substantially in the coming years, meaning that many smaller airports would benefit from duty free purchases made on arrival.

“Given the unique role that airports play as economic gateways, it is imperative that all steps are taken to keep them open through these difficult times. EU airports are currently losing hundreds of millions of euros of potential commercial income to their non-EU counterparts each year. Arrivals duty and tax free shopping will allow retail sales to be displaced from third countries back to the EU airport of arrival,” concluded ACI Director General, Olivier Jankovec.

 

Allowing duty and tax free

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