Duty on Shopping: UK Entry Points

Debate between Henry Smith and William Cash

Wednesday 6th September 2023 Commons Chamber

[Henry Smith]

The hon. Lady is exactly right; I have experienced similar when travelling to Australia or closer countries such as Switzerland. The boost that that gives to those local economies is quite significant.

In this country, however, we need to act quickly. Such a plan for arrivals duty-free is under active consideration by the European Commission as part of the directorate-general for taxation and customs union’s review into travel and tourism taxation. Introducing arrivals duty-free is the only way we would be able to level the field.

The third benefit is greater choice and passenger convenience. The modern passenger has come to expect the retail element of the travel experience. Duty-free purchases on arrival will contribute to a more seamless travelling experience. Arrivals shops are a separate market in competition with departure duty-free sales from airports abroad. The lack of arrivals duty-free is placing us at a competitive disadvantage.

Arrivals duty-free is not only convenient, but popular too: polling commissioned in 2022 found 45% of travellers regard carrying duty-free items back to the UK on their flight as an inconvenience. Polling conducted at several UK airports last year found that in many areas, including my own Gatwick airport, two thirds of people would support the Government introducing such stores.

Nevertheless, I am aware that there remain concerns among those on the Treasury Bench, and I am keen to address them. The first concern from His Majesty’s Treasury, I suspect, is the revenue implications for the Exchequer. Research from York Aviation predicts that such stores will result in additional sales of £100 million each year. An increased spend of between 20% and 30% per passenger is also anticipated. I therefore ask the Government to again look at the example of Norway, where, as of 2019, duty-free on arrival sales have increased by 108% since the policy’s implementation, and are growing consistently at an average rate of more than 10% each year.

In this scenario, the initial loss of excise duties for HM Treasury is quickly offset by other forms of taxation, in addition to new jobs. At Zurich airport, for example, the introduction of a single arrivals duty-free store meant an additional 50 jobs. For the UK, the increase in income tax and corporation tax is estimated to be an additional £50 million each year for the Exchequer. Even at the lowest levels of predicted sales, the impact on Government revenues is still likely to be only cost-neutral at worst. The policy would also increase sales on duty-paid categories.

The second concern that I suspect the Treasury has is about the impact on the domestic high street. Although I appreciate that concern, we need to be clear that the only competition to arrivals duty-free stores is from overseas departure duty-free stores. The introduction of the policy has the support of many brands that sell in the domestic market both on the high street and in travel retail channels. The size of the inbound duty-free market is less than 2.2% of the domestic market for the same products. Even if the policy were more successful than expected, any impact on the high street would be nominal. Passengers at an airport are drawn from a far wider catchment area than those in town centre stores, for example. To look again at examples from elsewhere, Switzerland and Norway have both had arrivals stores for over a decade, and neither has detected any impact on high street sales.

The third concern that I suspect the Treasury may have is about implementation. Let us be clear: in the model of arrivals duty-free stores proposed by the industry, arrivals stores would be located before customs clearance. That would avoid any additional staffing or resourcing pressures, and could provide a more robust level of control and oversight. Border Force and His Majesty’s Revenue and Customs would have the opportunity to observe and audit purchases using existing mechanisms, as they do now, and monitor inbound duty-free allowance limits. As a result of Brexit, only secondary legislation will be needed for implementation, so the change would not be burdensome on the busy schedule and agenda of this House.

Let me reiterate my support for sustainable aviation fuel more broadly, and for the wider aim of the aviation sector reaching jet zero—the commitment that UK domestic aviation will achieve net zero carbon emissions by 2040.

[Sir William Cash (Stone) (Con)]

Will my hon. Friend give way?

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. No. The hon. Gentleman has only just come into the Chamber. This is an Adjournment debate, and he should have been here from the beginning to intervene, as he knows.

Points of Order

Debate between Henry Smith and William Cash

Thursday 11th April 2019 Commons Chamber

[Sir William Cash]

rose—

[Henry Smith (Crawley) (Con)]

rose—

Europe

Debate between Henry Smith and William Cash

Wednesday 30th January 2013 Commons Chamber

[Henry Smith]

I was hoping to speak yesterday, to quote from the Reform Act of 1831 and refer to the sweeping away of the rotten boroughs—[Hon. Members: “1832.”] My apologies; I will refrain from using dates. Nevertheless, our history is based on free trade, as is our future.

[Mr Cash]

Does my hon. Friend accept that there is a serious problem if the free trade arrangements that he and I, along with many others, want are in any way obstructed by the exclusive competence of the European Union overlaying the question of whether we could trade freely with, for example, all the members of the Commonwealth and emerging markets?

[Henry Smith]

My hon. Friend is absolutely correct. It is an EU competence to negotiate free trade agreements. If we had that competence back, as a sovereign Parliament and a sovereign nation, we would once again be free to forge those free trade agreements. I am struck by the fact that there is a multilingual central European country that is free of the European Union, but which has free trade agreements with the European Union—and, indeed, the rest of the world—and that is the nation of Switzerland. It is perfectly possible for us to maintain co-operation and free trading with Europe and to extend that to the rest of the world.

Treaty on Stability, Co-ordination and Governance

Debate between Henry Smith and William Cash

Wednesday 29th February 2012 Commons Chamber

[Mr Cash]

I am grateful to the right hon. Gentleman, who makes an important point. However, this is not merely about technocrats but about the brutal fact that the political game as it is now being played is increasingly coercive. That is part of the problem that I shall address.

[Henry Smith (Crawley) (Con)]

Following yesterday’s announcement of the Irish referendum, does my hon. Friend share my concern that if the result is the wrong one as far as the European establishment are concerned, it will be ignored and overruled by some method or another?

[Mr Cash]

I do indeed. A new rule is being imposed through the arrangements under this treaty which involves a kind of qualified majority voting for referendums whereby if member states do not have the requisite number of referendums in which they say that they do not want the treaty, they will simply be ignored. I hope that when it comes down to it and the Irish people have this explained to them, that will be a spur to their voting no, because people are being taken for a ride.

European Union Fiscal Union

Debate between Henry Smith and William Cash

Wednesday 14th September 2011 Westminster Hall

[Mr Cash]

I am extremely grateful to the hon. Gentleman. He may recall that I raised the matter in Prime Minister’s questions, when I asked when the Prime Minister would lead us out of the mess that had been created by the existing treaties. This morning on the “Today” programme, we heard Lord Lawson of Blaby echoing that call and saying that he had always had grave reservations about the political union. I can only say that when the Maastricht treaty came and went, a lot of those arguments developed at the same time. The hon. Gentleman is completely right in saying that we must have a constructive alternative.

I have always advocated the idea of our working effectively with a European system capable of producing the right results. In fact, I hope that no one will mind my holding up a copy of a book that I wrote in 1990 called “Against a Federal Europe: the Battle for Britain.” I think I can confidently say that there is not very much in there that I would change and that most of it appears to have come true. To answer the question asked by the hon. Member for East Londonderry (Mr Campbell), I should say that it is very alarming to note that the first chapter is entitled “Britain for Europe”; it is not only a case of “Britain for Britain” but of “Britain for Europe,” because it is certainly true that we are affected by what goes on in the other member states.

As I have said many times before, the answer to the question is to go down the route of having an association of nation states, whereby we would return the right and proper power to this Parliament to make judgments on behalf of the people who have chosen us in a ballot box, to follow through policies, and to try to work in a form of understanding made on the basis of trade and political co-operation.

That was the situation anticipated by the 1975 debate when we had the referendum, which people understood. However since then, there has been onward and continuous progress towards ever further integration in an ever more undemocratic and ever more dictatorial manner. The time has come when we have to draw a line. It should have been drawn a long time ago. We drew it as a party over Lisbon. We said that we would not accept that treaty, but now here we are implementing it like there was no tomorrow.

A rather intriguing article by Camilla Cavendish was published on 8 September—only a few days ago—in The Times, which also had rather a good leader, either on the same day or the day before. It is rather amusing that she says:

“It’s no longer cuckoo to take the Swiss road; Britain and the EU are no longer going in the same direction. We should grab the chance for an amicable divorce”.

She then explains how that would be done. Essentially, she is arguing for an association of nation states, as many of us have. We are at a dangerous crossroads. A particular reason for this debate is the fact that the idea of fiscal union is being promoted. In our opinion—or in my opinion, anyway—that is entirely the wrong direction to take in the context of the broad landscape that I have been seeking to identify.

[Henry Smith (Crawley) (Con)]

My hon. Friend is making a persuasive argument. On the point of European nations not being members of the EU but being very successful, the article that he mentions refers to Switzerland, but there have recently also been articles about how the Norwegian krone is attracting a lot of investment. That is another example of a successful European nation outside the EU, which reinforces the point that an association of nation states rather than a political union is the best way forward.

[Mr Cash]

I endorse entirely what my hon. Friend has said. We are at a crossroads and it is a very dangerous crossroads. We have to get it right. It simply is not good enough to appease the European institutions by going along with their ideas when we have our own national interest to stand by, support and protect. We are not just talking about institutional arguments; we are talking about real people, their real daily lives, the unemployed and the people who cannot increase the enterprise of their businesses.

I was deeply concerned in my exchanges with the Prime Minister. I put a question to him on the question of the single market. In reply, he made it clear that he was conscious of a fact, which I had put in a pamphlet that I had published the day before. The pamphlet, by the way, is called “It’s the EU stupid”, because we have got to a stage where it is obvious that the EU is at the root of so many of these problems.

On the question of the single market, I pointed out to the Prime Minister that if there is a fiscal union of certain member states it is inevitable, as a matter of solidarity, that they will use the treaties to transfer their own wishes, through majority voting and a block vote, in a way that will be contrary to our own domestic economic interests. What would be the point of a fiscal union if, when it came to questions of legislation relating to the economy, the member states were not prepared to vote together? They will. When they do, and they outvote us, that will gravely undermine our competitiveness and our ability to grow small and medium-sized businesses. It will affect our growth. It will damage and destroy our prospects of reducing the deficit, because it will lead to a reduction in growth, which is already stagnant.

--- Later in debate ---

[Mr Cash]

The answer is yes. I did not say it so emphatically, but I said so when the Chancellor made his announcement in the House. I said that even Edward Heath would not have done what we were seeing now, so that probably sums the situation up quite well.

In my exchanges with the Prime Minister about fiscal union—I understand that these things can come out of the blue, but I wonder about the extent to which that was the case—he said:

“Of course, it will have an effect on us, but the clear rule for a referendum…is whether we are transferring power from Britain to Brussels.”

I do not agree that that is the basis for a referendum. It would be under the European Union Act 2011, but where a European decision, treaty or other legal instrument —in this case, there will be a mixture of those—applied on the face of it only to the eurozone, there would, under section 4, be no referendum.

That is why I have introduced a Bill saying we should have a referendum, and that Bill is supported by no less than six Select Committee Chairs, plus some distinguished Members, such as my right hon. Friend the Member for Wokingham (Mr Redwood), and members of the new intake who have taken a great interest in these matters. As I have said, the Bill has been presented, and the good news is that there will be a ten-minute rule Bill debate in October—the Leader of the House is here, and he knows that already. The Bill is intended to advance the case for a referendum on fiscal union.

In the Liaison Committee, the Prime Minister seemed pretty confident that there would not be a treaty. When I said that

“you are implying that there might not be a treaty” ,

he said—this was on 6 September—

“There is an important point on the issue of the treaty…Let us be clear: no one in Europe at the moment is currently talking about a new major treaty to put in place deeper fiscal union or changes in the eurozone. That may well happen in future…and if it were to happen, there would be consequences for Britain. Britain should think carefully about how to maximise our national interest”.

My answer to that is, first, that we now know that there will be a treaty, because the Chancellor of the Exchequer announced it from Marseilles. Secondly, I do not see how Britain can maximise its national interests when the new treaty, by its very nature, will erode the heart of those vital national interests.

There will be consequences for Britain, which raises another issue. We know there will be a treaty. As Mr Barroso said this morning—the Prime Minister has said this, too—it will be dealt with through a mixed bag of measures. Part of the process will no doubt be dealt with through enhanced co-operation, although the legality of that is very questionable indeed, and the European Scrutiny Committee will certainly look at that. Part of the process may also be dealt with through European Council decisions and intergovernmentalism, if those involved can get away with it. However, the bottom line is that the policy and the judgment are wrong, and we should not promote them. The best thing that I can suggest, therefore, is that we go to the next summit, put down a clear marker and insist that we will refuse to accept the treaty for fiscal union.

[Henry Smith]

Would our position as a country not be further strengthened in the negotiations if other EU members knew that any decision would be subject to a referendum in this country? The worst time to make irreversible treaty changes is during a crisis.

[Mr Cash]

I could not agree more. That is why I am making the plea that we get ahead of the curve now, although it is almost too late. We should get ahead of the curve now, get things right now and make sure that the crisis that we are in is remedied in good time. We will then be able to make sure that we get things right. However, that will involve turning the current treaty arrangements into an association of nation states. It will mean abandoning the current concept of the institutions, directly in opposition to Mr Barroso’s proposals today. The crisis is very great, but our ability to grow our economy and reduce the deficit—the very raison d’être of the coalition agreement, which said that that was the way to proceed—will be totally undermined unless the proposals that I have set out are pursued with vigour now.

Mrs Brooke, I am glad to have been able to make some of the arguments, and I hope that you will listen to the rest of the debate with pleasure.

Access to a Lawyer

Debate between Henry Smith and William Cash

Wednesday 7th September 2011 Commons Chamber

[Mr William Cash (Stone) (Con)]

The European Scrutiny Committee recommended this subject for a debate on the Floor of the House, in line with the written ministerial statement that all matters of this kind would be so debated when they

“have a substantial impact on the United Kingdom’s criminal or civil law”.—[Official Report, 20 January 2011; Vol. 521, c. 52WS.]

This is a very good starting point. However, I am somewhat disquieted by the extent to which the Minister has indicated—I hope that I am wrong, and that he will correct me if I am—that it is only a matter of time before, irrespective of the matters of principle that arise, we might end up opting in. I remind him that the whole process of the opting-in arrangements is based on a presumption against our opting in unless there are profoundly good reasons for doing so.

For the reasons that have already been touched on by the Minister and by the hon. Member for Hammersmith (Mr Slaughter), I believe that neither the difficulties that arise in relation to the application of arrest warrants nor the question of failures of justice in certain countries in the European Union may ever be sorted out. One need only look at a number of countries that came in by way of accession over the past few years. That went somewhat against the advice of the European Scrutiny Committee, and we had indicated beforehand that they had judicial systems that were so substantially below standard and riddled with corruption, with political judges and perverse procedures, that it was completely unacceptable that they should be allowed in. Access to a lawyer is obviously an important necessity, but whether one gets justice as a result of having such access when the courts themselves are corrupt is quite another story. That needs to be borne very much in mind.

We all believe that when citizens of the United Kingdom go abroad they should have access to a proper judicial system when they get there. Sometimes they are arrested, as in the case of some of the arrest warrants. We have heard reference to the Arapi case and one or two others. I have the greatest respect for Fair Trials International; its representatives have given evidence to the European Scrutiny Committee, and they have been very impressive. They have grave reservations about the arrest warrant and have said so. Where there is a serious problem in respect of the judicial system of a given member state, the fact that one has access to a lawyer may be only a minor mitigating factor.

Some time ago, before a lot of these laws were being put through, there was the case of the Greek plane spotters. Mr Arapi came from Staffordshire, and I noted what went on. My hon. Friend the Member for Staffordshire Moorlands (Karen Bradley) was instrumental in what happened. It was the subject of her first intervention in Prime Minister’s questions, and the Prime Minister immediately seized on it. I had a little word with her beforehand and suggested that it might be a good idea if she raised it with him, because I was convinced that he would immediately take the appropriate action, and he did. However, it took the intervention of the Prime Minister to sort this out, not access to a lawyer or to the judicial system where this poor man was convicted and sentenced to 16 years for an offence that he could not possibly have committed. The entire procedure that led to his conviction was utterly, completely and incontestably absurd, futile and dangerous.

My concern is less about access to a lawyer and more about whether people get justice even when they have a lawyer. That might seem rather strange, but it is exactly the problem. I do think that being able to contact consular authorities is incredibly important. I would certainly go along with that.

We have heard a number of points from the Minister, and I will briefly mention them, so as to put this on the record as Chairman of the European Scrutiny Committee. The potential consequence of article 10.2 and 13.2—of fettering the ability of a trial judge to decide on a case-by-case basis whether evidence should be admissible if it is obtained in breach of the directive’s provisions—is one problem. The other, as the Minister has indicated, is the financial implications of article 4, about providing a face-to-face meeting with one’s lawyer. As the Minister said, it is suggested that the cost of providing that could be as much as £32 million to £34 million a year. Another problem is the precluding of the use of accredited representatives. Those are people who are trained to advise a suspect at a police station. Even though they are not qualified lawyers, they at least provide a degree of assistance.

There is also the issue of the European convention on human rights, about which it is well known that I am not wholly enthusiastic, to say the least. It would be far better if, having drafted the European convention on human rights, we had been aware that we are quite capable of passing legislation in our own country to protect people’s human rights. The idea that I am not in favour of human rights, which the Home Secretary put to me the other day, is positively absurd. Of course I am in favour of human rights; I just want them to be real ones.

I am afraid that quite often artificial constructions are placed on the European convention on human rights, which have been criticised by some distinguished judges. The Lord Chief Justice himself said that the first duty of judges is not to apply Strasbourg decisions in the UK courts, but to protect the common law. A tremendous industry has been created since the 1990s, and the extent of human rights law has now reached astronomical proportions. It provides lawyers with a useful source of income without giving a proportionate degree of protection to those who seek human rights. Human rights could be provided for in Westminster if we passed our own legislation.

Another question is what effect an EU proposal would have if it failed to improve fair trial standards in our own criminal law. Even if it attempted to improve trial standards in other countries, what effect would it have on our criminal law? If the EU proposal had no effect it would become a lot easier to support it, with all the reservations that I have already expressed.

This afternoon, the Lord Chancellor gave evidence to the European Scrutiny Committee on the accession of the EU to the European convention. I assure hon. Members that he made it clear that that is a very, very long-term proposal, with huge degrees of negotiation yet to happen. Apart from that, there must be unanimity all the way down the line. He even ventured to suggest that it might not happen in his lifetime, or at any rate in his political lifetime.

We have to bear in mind the complexities that are being developed. The European convention, as it relates to the citizens of this country and others abroad, interwoven with the charter of fundamental rights under the Lisbon treaty, which of course we voted against but which the Government are now implementing, produces the curious result of a multiplicity of complex procedures all overlapping with one another. It is important that we bear that in mind, because it would have a bearing on cases such as those that we are discussing.

As I have said, given that we have tried and tested procedures, my preferred option would be not to opt in. I have grave reservations about the tsunami of opt-ins that we have been seeing.

[Henry Smith (Crawley) (Con)]

Is not the fundamental problem with EU opt-ins that if we opt in there is no way back, so if our negotiation is not successful we are stuck with whatever is decided, but if we choose to opt out we are not part of the negotiations? That means that if we opt in at a later stage we get the worst of both worlds. That is a fundamental flaw of the European Union and the opt-in system.

[Mr Cash]

I very much agree with my hon. Friend, who is also on the Committee and witnesses these things at first hand. The Committee recommended this debate, and I am glad that it is taking place. It is not a token exercise, and I trust that the Minister understands that there are serious reservations about how the judicial system operates in other countries. Although we certainly believe that access to a lawyer and to consular authorities is a good idea, we do not have to have the Lisbon treaty, the European Union or an opt-in procedure under those arrangements to provide for access to the courts or to secure protection for those who need it.

United Kingdom Parliamentary Sovereignty Bill

Debate between Henry Smith and William Cash

Friday 18th March 2011 Commons Chamber

[Mr Cash]

The question also arises in the context of assertions by the courts. It is important that we respect the independence of the judiciary, but the judiciary in turn must respect the rights and privileges of the elected House of Commons and, indeed, Parliament as a whole. The claims that have been made, which are set out in the European Scrutiny Committee report, clearly demonstrate that moves are not only afoot but under way to qualify the sovereignty of the United Kingdom Parliament and Acts of Parliament. Such moves fall back on an assertion that they are relying on the rule of law. I have asked questions about this repeatedly, not least in a debate in Westminster Hall yesterday on the Bill of Rights, and suggested that we ask these questions: whose law, which law, and how has it arisen?

[Henry Smith (Crawley) (Con)]

This country has an evolving constitution that is not written down in any one place. Does my hon. Friend agree that there is a danger of authority slipping away from Parliament unless we restate that?

[Mr Cash]

That is completely right, and I am grateful to my hon. Friend for not only his intervention but his notable contribution to the European Scrutiny Committee, of which he is a member.

The question of amending the Bill gives me an opportunity to set out another short clause that might be added to it.