Keep tax-free sales at airports and the VAT Retail Export Scheme

The government has decided to remove the airside extra-statutory concession for tax free sales at airports and withdraw the VAT Retail Export Scheme for international visitors. Sign the petition to reverse the decision!

12,601 Signatures

Status: Open
Opened: 29 Oct 2020, 12:08 p.m.
Last 24 hours signatures : 1
Estimated Final Signatures: 18,999

Daily Rank: #4662 • Weekly Rank: #1818 • Total Rank: #113


This content was generated for your convenience by Parallel Parliament and does not form part of the official record.
Recent Documents related to Keep tax-free sales at airports and the VAT Retail Export Scheme

1. A consultation on duty-free and tax-free goods carried by passengers.
11/09/2020 - HM Treasury
- View source

Found: consultation on the potential approach to duty - and tax - free relationship with the EU : Summary of r

2. A consultation on duty-free and tax-free goods carried by passengers.
11/09/2020 - HM Treasury
- View source

Found: consultation on the potential approach to duty - and tax - free relationship with the EU. March 20 20

3. A consultation on duty-free and tax-free goods carried by passengers.
11/03/2020 - HM Revenue & Customs (HMRC)
- View source

Found: consultation on the potential approach to duty - and tax - free relationship with the EU. March 20 20

4. Duty and tax-free shopping
04/11/2020 - Early Day Motions

Found: recent Government consultation on the continuation of duty and tax-free shopping for visitors from outside

5. Spending Review 2020 documents
25/11/2020 - HM Treasury
- View source

Found: publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated.

Latest Documents
Recent Speeches related to Keep tax-free sales at airports and the VAT Retail Export Scheme

1. Exiting the European Union (Excise)
03/02/2021 - Commons Chamber

1: revoked.We fully support the extension of duty-free shopping for people travelling to the EU, which - Speech Link

2. The Future of the High Street
10/12/2020 - Commons Chamber

1: pandemic, and I want to reassure the House that this Government are unwavering in our commitment to support our - Speech Link
2: organisations that are working with their members and the Government to plan for recovery. It is clear that covid-19 - Speech Link
3: in the world. The Government announced in the spring that the business rates retail discount would be - Speech Link

3. VAT Retail Export Scheme
20/10/2020 - Lords Chamber

1: Majesty's Government what assessment they have made of the financial impact on (1) the retail, and (2) - Speech Link
2: My Lords, the Government have announced that the VAT retail export scheme will not be extended to - Speech Link
3: this tax reform puts 128,000 jobs under threat and could see a fall of £6 billion in retail sales and - Speech Link
4: that the Government have put in for retail during the pandemic. Unfortunately, the Government disagree - Speech Link

4. Exiting the European Union (Value Added Tax)
03/02/2021 - Commons Chamber

1: I beg to move,That the Value Added Tax (Miscellaneous Amendments to Acts of Parliament) (EU - Speech Link
2: motion:That the Value Added Tax (Miscellaneous Amendments to the Value Added Tax Act 1994 and Revocation) - Speech Link
3: and necessary changes in order to ensure that the VAT system continued and continues to operate, as required - Speech Link

5. Oral Answers to Questions
26/01/2021 - Commons Chamber

1: (a) retail and (b) aviation industries on the VAT retail export scheme and airside extra statutory concessions - Speech Link
2: consultation on duty free and tax-free goods carried by passengers in 2020, the Government engaged extensively - Speech Link
3: was a mistake to scrap the VAT retail export scheme and the extra-statutory concessions, both of which - Speech Link
4: the fiscal impact of the withdrawal of the VAT RES scheme, factoring in a higher than usual elasticity - Speech Link
5: of (a) home schooling and (b) following other Government covid-19 guidance have equitable access to financial - Speech Link

6. Aviation Industry
18/11/2020 - Westminster Hall

1: to work on capital investment projects at our airports in the coming months but capital budgets have - Speech Link

7. Taxation (Post-transition Period) Bill
16/12/2020 - Lords Chamber

1: It sets out a new framework for the UK’s customs, VAT and excise systems following the end of the transition - Speech Link
2: implementing the Northern Ireland protocol, the Government have sought to minimise changes to how the rules - Speech Link

8. Licensing Act 2003: Post-Legislative Scrutiny (Licensing Act 2003 Report)
20/12/2017 - Lords Chamber

1: spirits. My husband has worked for many years for international airlines and more recently with the London School - Speech Link

9. Hospitality Industry: Government Support
11/01/2021 - Westminster Hall

1: procedure that is there to ensure social distancing and keep Members safe.Members who have not arrived - Speech Link
2: considered e-petitions 552201 and 329985 relating to Government support for the hospitality industry.It - Speech Link
3: job to continue when we went into government, but the size of Government restricts the number of Ministers - Speech Link
4: weight to the argument for a voice at the heart of Government who can represent the interests of not only all - Speech Link

10. Coronavirus: Supporting Businesses and Individuals
23/02/2021 - Commons Chamber

1: beg to move,That this House calls on the Government to support businesses and individuals still struggling - Speech Link
2: extending the temporary 5 per cent reduced rate of VAT for three months after restrictions are lifted or - Speech Link

Latest Speeches
Recent Questions related to Keep tax-free sales at airports and the VAT Retail Export Scheme
1. Exports: VAT
asked by: Seema Malhotra
23/10/2020
... if he will publish an economic impact assessment of the effect on airports of his decision to (a) withdraw the VAT Retail Export Scheme for all passengers and (b) remove tax-free sales for non-excise goods throughout the UK.

2. Duty Free Allowances
asked by: Ruth Cadbury
13/01/2021
... what representations he has received from the hospitality industry on the decision to remove (a) the VAT Retail Export Scheme and (b) tax-free airside shopping.

3. Duty Free Allowances
asked by: Ruth Cadbury
13/01/2021
... Media and Sport on the abolition of (a) the VAT Retail Export Scheme and (b) tax-free airside shopping.

4. Duty Free Allowances
asked by: Ruth Cadbury
13/01/2021
... what assessment has he made of the effect of the removal of the (a) VAT Retail Export Scheme and (b) tax-free airside shopping on the tourism sector within London.

5. Exports: VAT
asked by: Nickie Aiken
11/09/2020
... what proportion of responses to Question 9 in the consultation on duty-free and tax-free goods carried by passengers supported extending the VAT Retail Export Scheme to visitors from EU member states.

Latest Questions

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With the UK plunging into recession and unemployment soaring, the government has chosen to remove tax free sales on airside products (excluding alcohol and tobacco) at airports and stop VAT refunds for overseas tourists in shops from 1 January.

This could not only cause thousands of job losses across the UK, but mean prolonged despair for businesses such as airports.

Sign the petition to save jobs and your tax-free perks!


Top 50 Constituencies by Number of Signatures

5,451 signatures - 43.0% of total

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Government Response

Visitors can shop VAT-free when purchases are sent directly to overseas addresses. The withdrawal of the tax-free schemes is part of a package of changes, with significant benefits for UK consumers.


The VAT Retail Export Scheme and tax-free sales at airports largely provide “tax-free perks” to overseas visitors.

The Government’s passenger policy, after the end of the Transition Period, provides UK consumers with significant benefits.

To remain compliant with World Trade Organisation (WTO) rules following the transition period, the UK’s VAT and excise rules will no longer be able to treat individuals carrying goods for personal use (passengers) to/from the EU, differently to those travelling to/from non-EU countries.

The Government published a consultation, which ran from 11 March to 20 May 2020. The Government held virtual meetings with stakeholders to hear their views and received 73 responses to the consultation. The detailed rationale for these changes are included in the written ministerial statement and summary of responses to the consultation: https://questions-statements.parliament.uk/written-statements/detail/2020-09-11/hcws448 and https://www.gov.uk/government/consultations/a-consultation-on-duty-free-and-tax-free-goods-carried-by-passengers.

For the first time in over 20 years, the Government is providing duty-free sales for passengers travelling from Great Britain (GB) to the EU (approximately 67m UK passenger journeys in 2019). This also boosts regional airports, which primarily rely on EU travel. Extending duty-free to EU-bound passengers will significantly increase the cost of the scheme as many more people travel to the EU than non-EU destinations.

The Government has also roughly quadrupled alcohol allowances for passengers arriving in GB – introducing one of the most generous alcohol allowances in the world. This will benefit a significant number of UK residents a year by allowing them to bring into GB, for example, three crates of beer, two cases of wine and one case of Champagne for personal use, without having to pay the relevant taxes – a saving of up to £120 of UK excise duty.

Alongside these benefits to UK residents, the Government is withdrawing the VAT Retail Export Scheme (RES) and tax-free airside sales, which largely benefit overseas visitors.

On 25 November the independent Office for Budget Responsibility (OBR) set out its assessment of the fiscal impact of the withdrawal of the VAT RES and tax-free airside sales. The OBR estimates that the withdrawal of the VAT RES will result in a significant direct saving of around £400 million per year to the taxpayer, once passenger numbers recover from the impacts of Covid-19.

This includes an assumption that approximately 20,000 – 30,000 fewer tourists visit GB a year, based on the 1.2 million users of the scheme in 2019 (less than one-in-ten of all eligible visitors). That is a reduction of 0.07% of the 40 million visitors to the UK in 2019.

The OBR does not, by convention, cost alternative policies to those adopted by the Government – in this case, extension to EU residents – but the Government’s view is that this would have resulted in a large deadweight loss by subsidising spending from EU visitors, which already happens without the VAT RES in place.

Again, the choice for tax-free sales was between removing the scheme or extending it to EU-bound passengers. Extending the relief to the EU would significantly increase the cost of the scheme and result again in a large deadweight loss by subsidising spending from EU-bound passengers which already happens.

The OBR estimates that the withdrawal of tax-free airside sales will result in a saving of around £170 million per year, after behavioural responses are taken into account and passenger numbers recover from the impacts of Covid-19.

The Government recognises the challenging circumstances facing the aviation industry as a result of Covid-19. On 24 November the Government announced a package of financial support for commercial airports and ground handlers. This support, which will shore up jobs and reinforce local economies, will be equivalent to the business rates liabilities of each business, capped at £8 million per site, and subject to certain conditions. This scheme will open in the New Year.

This builds on the Chancellor’s announcement on 5 November that the Coronavirus Job Retention Scheme will be extended until March 2021, with employees receiving 80% of their usual salary for hours not worked, up to a maximum of £2,500 per month. The Bounce Back Loan Scheme has also been extended to help small businesses during the Covid-19 outbreak. These measures will continue to protect jobs and businesses across the UK.

HM Treasury