UK Airport Shops Found to Collect VAT from Exempt Travelers

By Paul Riegler on 2 January 2016
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Heathrow's new Terminal 2,

Heathrow’s new Terminal 2,

The British government plans to take steps to ensure that shops at airports in the country are passing along savings in value-added tax due to shoppers flying to destinations outside the European Union.

In a statement released Thursday, George Osborne, the chancellor of the Exchequer, said that some shops are keeping as much as 50% of the VAT savings instead of passing it on to their customers.

“This is simply unacceptable,” he said. “For families flying out of the UK for a winter-getaway, airports should be the ideal place to pick-up a bargain.”

All passengers regardless of nationality are exempt from paying value added tax when flying to non-European Union destinations, including British subjects. A study by the government found that some shops at the country’s airports were charging VAT where they were not supposed to and keeping it instead of remitting it to tax authorities.

“VAT relief at airports is intended to cut prices for those travellers – not be a windfall gain for shops,” the chancellor said.

(Photo: Accura Media Group)

Accura News

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