Budget 2020: post-Brexit duty-free limits up for review

The government plans to consult on the duty-free limits of alcohol and cigarettes available to airline and ship passengers in a post-Brexit world 

One of the policy areas that the government plans to review in light of its new relationship with the EU is the long-term approach to duty-free and tax-free goods carried by passengers.

Areas up for review include:

  • the amount of goods passengers are allowed to bring in to the UK without paying duty and tax;
  • the sale of duty-free goods to passengers on departure from the UK;
  • the sale of tax-free goods to passengers on departure from the UK; and
  • the VAT Retail Export Scheme, which allows certain non-UK residents to obtain a VAT refund on high street goods they buy and take home with them in their luggage.

The current personal allowances for non-EU passengers are set out in EU legislation. Therefore, after the transition period, the government will be free to consider whether the personal allowances for alcohol and tobacco products should be changed.

The personal allowance for bringing non-excise goods into the UK (currently £390, unless the passenger arrives by private plane/boat in which case the allowance is £270), and customs processes for passengers are out of scope of this consultation.

For the purposes of this consultation duty-free goods are defined as alcohol and tobacco products sold free of excise duty and VAT:

  • in duty-free and tax-free shops, located beyond security control in UK exit and entry points; and
  • on-board scheduled ships and aircraft departing from the UK or destined for the UK.

The consultation closes for comment on 20 May 2020.

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