An article in The Independent newspaper on 12 August 2015 reported that treasury ministers had demanded an end to rip-off VAT charges by some airport stores. The Financial Secretary to the Treasury told The Independent he was concerned and disappointed that some of Britain’s top retailers were pocketing millions of pounds in VAT discounts without passing the savings to customers.
Passengers’ boarding passes were required to be shown in some cases, and the information was used by stores to avoid paying 20 per cent VAT on everything they sold to customers who were travelling outside the European Union. Most of these stores, including WH Smith, did not pass on the savings to passengers.
The Treasury Secretary said the intention behind VAT relief at airports was to help passengers and not to line the pockets of retailers – and called for the practice to stop. “The VAT relief at airports is intended to reduce prices for travellers not as a windfall gain for shops,” he said.
Many passengers claimed to have been misled by airport shop staff who told them presenting a boarding card was obligatory – and even required for security purposes.