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Airport outlets vow to provide clear VAT savings

Travel2Shops at the UK’s major airports have vowed to tell customers exactly how they return the VAT savings from tax relief to them.

A year on from the furore that surrounded retailers making a 20% tax-saving profit on goods when selling to those that fly outside of the EU, the shops have promised to make things clearer for flyers.

With customers angry that they were not making savings, and refusing to show documentation to retailers, the UK Travel Retail Forum (UKTRF) and Airport Operators Association (AOA) has signed up dozens of major airport shops to a new code of practice.

World Duty Free and Harrods are among those to sign up, which will see them tell customers how the VAT deductible from passenger purchases is used, either via signs or online notices.

The UKTRF and AOA say the move will enhance transparency for customers and is designed to give greater confidence in their ability to shop at UK airports before travelling.

It should provide a boost for gadget sales and other airport pre-holiday purchases, as customers will likely be more inclined to make a purchase on top of other holiday essentials such as travel and car rental insurance.

Importantly, the code does state that customers may still need to provide their boarding passes at the time of passes to ensure retailers can “identify qualifying sales”.

AOA Chief Executive Darren Caplan said that member airports are “determined to ensure that passengers have an excellent experience form the moment they arrive at the airport to the moment they leave”.

Of course when the UK does eventually leave the EU, even more customers will be entitled to VAT refunds.

The Telegraph reports that some retailers, including Harrods, sell all of their products at VAT-free prices while others, including Dixons and WH Smith have offered small reductions.

The latter announced in July that it would reimburse 16.6% on any non-duty free products over £6 if you’re flying outside of the EU, based on how VAT is refunded.

A number of big retailers have signed up to the new code, including Cath Kidston, Fat Face, Lacoste, Reiss, Ted Baker, Temptation and Victoria’s Secret, among others.

If you’re travelling abroad this year, be sure to organise your Long-Haul Travel Insurance in advance.

Date Created: 26 September 2016

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