Airport shops told to pass on tax discounts

Sky News reports that the intervention comes after it was reported that some major retailers are not passing on the VAT relief they get to customers.

Treasury minister David Gauke said stores should not being using the discount to boost their profits.

“The VAT relief at airports is intended to reduce prices for travellers, not as a windfall gain for shops,” he said.

“While many retailers do pass this saving on to customers, it is disappointing that some are choosing not to.

“We urge all airside retailers to use this relief for the benefit of their customers.”

Steve Baker, a Conservative member of the Treasury select committee, told the Daily Telegraph that passengers were being “ripped off”.

“Consumers are entitled to expect that tax savings will be passed to them rather than become another addition to the bottom line for companies,” he said.

“I always thought that showing a boarding pass was an official requirement.”

Many airport stores ask passengers to present their boarding cards when making a purchase.

The information on the boarding cards can then be used to claim VAT relief on sales to people leaving the EU.

The relief means retailers do not have to pay the 20 per cent VAT on the goods they sell to those passengers.

It is not a legal requirement for passengers to show their boarding cards when buying goods at airports.