Cheating barstewards, I've actually been refused service a number of times because I didn't have my boarding card on me Airport shops row: Boots and Dixons to issue new rules on boarding pass checks Amid passenger revolt retailers are understood to be speaking to staff reminding them customers are not obliged to show boarding cards
Boots and Dixons are to issue new guidance to airport staff about checking customers’ boarding passes following a consumer revolt over “rip-off” VAT charges.
Customers of Boots and Dixons and other prominent stores including WH Smith pledged not to show their boarding passes at airports after it emerged that retailers were benefiting from VAT savings without lowering prices.
Attacking the practice as a “fraud” and a “con”, customers said they felt they were obliged to hand over their boarding cards at checkouts for security reasons or because they were getting a discount.
However, it has emerged that the information is used by stores to avoid paying 20% VAT on everything they sell to customers who are travelling outside the EU. Many stores, including Boots and WH Smith, do not pass this saving to consumers.
Amid growing revolt on Wednesday, Dixons said it had reminded its staff that customers are not obliged to hand over their boarding card at checkouts.
A Dixons spokeswoman said: “At Dixons Travel we do ask customers to show their boarding pass when making a purchase, but this is only on request and is not mandatory. We have re-issued existing guidance to all our colleagues confirming this as our clear process.”
A Boots spokeswoman said: “At Boots we always listen to our customers and to help remove any confusion at this time, we have taken the decision to no longer ask customers to show us their boarding passes while we undertake a longer term review of this situation. We are currently in the process of notifying our airport store colleagues of this change.”
The revolt comes after Treasury minister David Gauke said some retailers were not passing on savings to customers. Speaking to the Independent, he said: “The VAT relief at airports is intended to reduce prices for travellers, not as a windfall gain for shops.
“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.”
The shadow culture secretary, Chris Bryant, was among those on Twitter saying he would refuse to show his boarding pass at airport stores.
At Heathrow on Wednesday, passenger Owen Evans blamed the government for not preventing retailers from taking advantage of the loophole. “It should be made illegal,” he said. “If the shops are playing the system, it’s the government’s fault for allowing them to do that. Anyone would do that if it’s legal. Obviously you want to do the best for your business. But obviously it’s not providing the best service for your customers.”
On Facebook, the retailers faced a storm of criticism from angry customers. Ian McNaughton demanded to be told when Boots would repay the government the VAT it had “essentially extorted” from customers flying outside the EU.
“Having purchased from Boots many times when flying abroad I’ve unwittingly been implicated in what in effect is fraudulent activity which I’m annoyed about now!” he said.
“Your behaviour and that of other airport retailers regarding this VAT issue is abhorrent and reflects major retailers contempt for their customers! I will not be buying anything from Boots again if I can until you change policy regarding this issue of VAT ‘fraud’ and make the necessary amends and would urge other customers to do likewise!!”
Another customer, Connie Tindale, asked Boots why “your staff at Gatwick are so aggressive when they ask for boarding passes”. A Boots representative replied that they were “concerned to hear about the Gatwick stores and will ensure this is fed back to them”.
At Heathrow, Jonathan Stanton, head of digital retail at Nintendo and a regular traveller, said he wanted the VAT he had paid in duty-free shops to be refunded. He said he felt cheated. “It’s unfair if they pocket the money,” he said. “It’s basically the VAT that we pay and they are pocketing it.
“It doesn’t make any difference to me today, but I have just come back from LA and I’m going to New York in a few weeks. I would probably like them to give me the VAT back at the point of purchase.”
Of the boarding card checks, he added: “I thought it was just a security requirement. It was never explained to me at the time.”
A spokeswoman for Boots said customers were asked – not forced – to show boarding cards at airports. She said: “It is not compulsory to ask for [boarding cards] so if someone doesn’t want to show it we won’t force it.”
In a statement the company said information on boarding passes was used to ensure accurate accounting. It said: “Our airport store teams are asked to request and scan boarding cards to ensure the accuracy of our accounting records, which includes the accurate reporting of VAT. We request our customers’ boarding cards so that our VAT accounting is in line with the HMRC’s requirements.
It added: “The HMRC and airports accept that this is general practice for all retailers located within airport terminals. Our pricing in airport stores is consistent with our London prices and VAT is not taken into account when setting prices of products. Showing a boarding card is not a compulsory requirement and any of our customers that do not wish to share this information can shop with us without the boarding card being scanned.”
A former WH Smith employee at Manchester airport, who did not wish to be named, told the Guardian that store staff were told to check boarding passes as part of an unexplained “survey”.
WH Smith confirmed that staff in its airport stores requested customers to show boarding passes, but conceded “there is no obligation on the part of the customer” to do so.
It added that dual pricing would be impossible to implement even though many duty-free shops already display two prices – one if you are flying in the EU and a lower price if you are flying outside the EU.
It said: “Whilst much of what we sell, eg 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 WHSmith to analyse the purchasing trends by time of day and by product category for customers travelling to different locations, and assists us 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 WH Smith customers.” Source