Treasury blocks duty-free shopping for Northern Ireland
The Treasury has blocked a multi-million pound Brexit benefit for Northern Ireland by refusing to allow duty-free shopping on flights to Great Britain and the EU.
Travellers leaving the province are not allowed to take advantage of tax-free offers when heading to either Great Britain or European countries.
Ports and airports there have repeatedly warned the Government that this means they are losing out on vital custom to competitors, especially those in Ireland.
But the Treasury is resisting pressure and has told them it can’t allow duty-free shopping for travellers heading to Great Britain because Northern Ireland is part of the UK’s tax area.
The Commission has given the same reason for visitors to the EU, arguing the Province is following its tax rules under the Brexit border deal.
One industry source told The Telegraph that as a result, the travel industry in Ulster has “the worst of both worlds from the Protocol”.
Northern Ireland follows hundreds of EU rules, including on tax rates, under the deal that was struck to avoid a hard border with the Republic.
The return of duty-free shopping between the UK and the continent was one of the big selling points of Brexit for consumers and businesses.
Brussels banned tax-free allowances for travellers moving between EU states in 1999.
They were reinstated for holidaymakers heading from Great Britain to European countries in 2021, but not for those coming from Northern Ireland.
‘It doesn’t make sense’
Airports and ports in the province have appealed to both London and Brussels to allow duty-free shopping for travel to either GB or the EU.
They have privately warned customers are choosing to travel from Dublin instead, where the port and airport are both owned by the Irish state.
Baroness Hoey of Lylehill and Rathlin, a Northern Irish peer, has written to the Government demanding that it acts to fix the problem.
She said the current situation was “a joke” and that neither side wanted to publicly admit that it was the Protocol that was at fault.
“If Northern Ireland remains an integral part of the UK as does the rest of Great Britain, why can I get duty-free flying to EU countries from anywhere in Great Britain but not from airports in Northern Ireland? It doesn't make sense,” she said.
David Jones, a former Brexit minister, said the fact that both sides were claiming Northern Ireland as part of their tax jurisdiction was “an outrageous situation”.
“Almost every week we find a new example of the idiocies of the Protocol that are making life less pleasant for people and businesses in Northern Ireland,” he said.
“The sooner we get rid of the Protocol the better.”
A spokesman for the Treasury said: “Duty-free shopping is based on a relief from excise duty because the goods were purchased outside the UK.
“Northern Ireland is an integral part of the United Kingdom’s tax territory, and as such applying duty-free arrangements would risk undermining business in both Great Britain and Northern Ireland.”