BOARDING PASSES OF passengers travelling through Dublin Airport are being scanned in shops so retailers can understand your spending patterns and claim back VAT.
Retailers, some of which operate stores in Dublin Airport, have admitted that customers are not actually required to show their boarding passes at the till and those who do are merely helping companies claim back VAT.
The Telegraph newspaper reports that this revelation has brought about a “mini-revolution” at airports across the UK with many people refusing to show their boarding passes to staff at shops when asked.
Duty-free shopping
A statement to TheJournal.ie from the DAA states that boarding cards are scanned by ARI subsidiary for a number of reasons.
These include checking whether a passenger is travelling to a duty free or duty paid destination and understanding passenger spending patterns.
“We use this information in conjunction with other market research to improve the retail offer in our stores, and to help plan staffing levels.”
This information also allows DAA to assess the commercial potential of a new route or service, as we may have information on historic passenger spends for the destination and/or the airline in question. The only information that is tracked is the item purchased, the airline, and the destination in question.
No personal details such as a person’s name or passport number are recorded.
Mandatory
However, when asked if it is mandatory for fliers to show their boarding pass in shops DAA shops, a spokesperson said:
In order for a passenger to buy duty free alcohol or tobacco it is a legal requirement that the passenger in question can prove that they are travelling to a duty free destination.
“We ask to scan all passengers’ boarding cards as this tells us their destination and whether it is duty paid or duty free location.
This information also helps us improve our stores and our retail offer by tracking purchases based on destination and airline.That is the only information that is tracked – we don’t record any personal information in relation to the passenger.
“It is policy in our stores to ask that passengers present their boarding card when making a purchase, however if any passenger is buying a non duty free product does not wish to provide this information we will still make the sale.”
The terms and conditions on The Loop – Dublin Airport’s shopping website, also states that a boarding card must be presented when purchasing goods.
In order for a passenger to buy duty free alcohol or tobacco the DAA said it is a legal requirement that the passenger in question can prove that they are travelling to a duty free destination.
Ireland has one of the highest VAT rates in Europe at 23%.
Duty free shopping within the European Union ended in 1999, however it still applies to those travelling outside the EU.
The DAA said it offers a single price to all customers across many product categories, whether they are travelling to a duty paid or to a duty free destination.
In this way, it says it passes on VAT savings for duty free passengers to all their customers.
In our stores, any VAT savings that are made on items that do not have a specific duty free price are passed on to all our passengers, as they are used to enable our shops to offer significant discounts on key product ranges to all passengers using the airport, regardless of their destination.
This means that the benefit goes to 100% of customers rather than the relatively small number of passengers who are travelling to a duty free destination. As indicated previously, there are separate duty free and duty paid prices for many alcohol products.
The DAA said it can guarantee that perfumes, aftershaves, skin care and make-up are up to 20% cheaper than downtown prices. The savings apply to all passengers, regardless of whether or not they are flying to a duty free destination.
The company said that what makes them different is it is a retailer operator as well as an airport operator with 81% of passengers using Dublin Airport travelling to duty paid destinations.
It added that income from its retail activities at Dublin Airport subsidises the airport charges at the airport.
The company said it could not comment on behalf of other retailers’ practices.
A statement from Boots Ireland said it does not ask to see traveller’s boarding passes .
“We do not claim back VAT on purchases made by customers flying to non EU destinations,” said a Boots spokesperson.
The retailer said it has a single pricing structure for everyone regardless of where they are travelling.
A statement from WH Smith, which has a shop at Dublin Airport said it is its policy that boarding passes should be “requested from customers and not demanded” as there is no obligation on part of the customer.
Addressing the issue of VAT, it stated:
Whilst much of what we sell, e.g. newspapers, magazines and books, is fixed price and does not attract VAT, any VAT relief associated with the identification of customers travelling outside of the EU is reported in accordance with UK legislation, and any relief obtained is reflected in our single price and extensive promotional offers provided to all of our customers.
Operational and financial system constraints make any form of “dual pricing” for our extensive product file a practical impossibility.
The destination data, regardless of whether it is to the UK, EU or beyond allows WH Smith to analyse the purchasing trends by time of day and by product category for customers travelling to different locations, said the company.
It said the information assists them “in product ranging and placement decisions at our airport stores”.
This information is limited to the IATA three digit destination airport codes, which form the basis of IATA’s worldwide airport database and does not give access to any personal data of WHSmith customers.
What is the result of refusing to show your boarding pass?
By refusing to show your boarding pass the only people to be hit are the retailers.
If you are flying outside the EU retailers can reclaim the VAT. However, if they don’t have the evidence that you are flying outside the EU – namely your boarding pass information – they can’t reclaim their VAT.
The UK’s Independent newspaper reports that this issue has caught the attention of the UK’s Financial Secretary to the Treasury, David Gauke.
He told The Independent that 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.
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