Airport VAT ripoff?
Author
Discussion

creampuff

Original Poster:

6,511 posts

173 months

Sunday 9th July 2017
quotequote all
Let me know if what I think is happening, is happening.

If you buy a mid range iPhone on the high street, the price is £799. Inc VAT obv. So it's £666+£133 VAT, to the nearest pound.

I'm about to depart the EU at Heathrow airport and I just popped into Dixons. They are selling the £799 high street priced phone for £769. £30 cheaper than the high street.

But on enquiring, Dixons will not give you a VAT receipt or anything with their VAT number on it. Are they selling an ex-VAT phone which should cost £666, for £769, not remitting any VAT to HMRC and trousering an additional £103 per sale?

playalistic

2,270 posts

194 months

Sunday 9th July 2017
quotequote all
It is and has been for a very long time. Lots of airport retailers - namely Dixons, WH Smith and Boots among others - do not pass on the saving. Showing your boarding card isn't mandated. When asked for your boarding card you may refuse to, thus avoid their trousering.

anonymous-user

84 months

Sunday 9th July 2017
quotequote all
Far more likely that whoever you spoke to doesn't know what they're doing.

Presumably as it was at an airport this was a Dixons travel store? Their VAT number is on their website.

creampuff

Original Poster:

6,511 posts

173 months

Sunday 9th July 2017
quotequote all
^ On their website, but not their invoice. They need to be VAT registered..... doesn't mean they actually pay any VAT to HMRC when you buy something off them!

DIW35

4,205 posts

230 months

Sunday 9th July 2017
quotequote all
It's a well known fact that airport prices are a rip-off, and the VAT scam has been highlighted many times, but things never change.

Dr Jekyll

23,820 posts

291 months

Sunday 9th July 2017
quotequote all
Why is it a scam? They advertise an iPhone for £769, you pay £769 and walk away with an iPhone.

irocfan

48,995 posts

220 months

Sunday 9th July 2017
quotequote all
Dr Jekyll said:
Why is it a scam? They advertise an iPhone for £769, you pay £769 and walk away with an iPhone.
correct - it's not a scam in the sense that the price is what it is with no hidden extras. What is the scam is that whole 'VAT free' thing which it most obviously is not. The other scam as best as I can make out is that you are 'required' to show your boarding pass, which, from what I can tell is complete BS

anonymous-user

84 months

Sunday 9th July 2017
quotequote all
Fair enough, I thought you wanted it as you said they wouldn't give you anything with their VAT number on it.

I'd raise it with their customer service team or similar to confirm it's not just a cock-up at store level. Very easy for "We don't give VAT receipts unless it's a specific request, there's this process for it" to turn into a straight "We don't" when you've got someone on minimum wage (who frankly can't be arsed with it) dealing with the query.

Report the refusal to HMRC if you don't get anywhere, if enough people report it then they'll take an interest.

Tablecloth

255 posts

116 months

Sunday 9th July 2017
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If you buy it VAT free then bring it back and use it in the U.K. would you not need to pay the tax on import when you come back?

creampuff

Original Poster:

6,511 posts

173 months

Sunday 9th July 2017
quotequote all
^ This would have been a permanent export.

Tony1963

5,808 posts

192 months

Sunday 9th July 2017
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This has been publicised in mainstream media fairly recently, and nothing was done. Not enough people will refuse to show their boarding card, so the retailers will continue as they are.

I never buy anything at an airport unless its unavoidable. Airports are miserable life-vacuums devoid of any pleasure.

iwantagta

1,324 posts

175 months

Sunday 9th July 2017
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WHS now discount the VAT back to customers on a boarding card scan to a non VAT country.

Regarding Dixon's price being almost as high for an apple product in an airport;
What do you think the cost of business is for Dixons to have a site in Heathrow Airport Vs Warrington High Street?

TwigtheWonderkid

49,130 posts

180 months

Sunday 9th July 2017
quotequote all
How much do Dixons pay to have a shop in the airport? Are the overheads comparable with the High St. I don't know, but somehow I doubt it. I bet they pay far more per sq foot in an airport terminal. This may explain why all airport prices in all shops are higher.

voyds9

8,490 posts

313 months

Sunday 9th July 2017
quotequote all
iwantagta said:
WHS now discount the VAT back to customers on a boarding card scan to a non VAT country.

Regarding Dixon's price being almost as high for an apple product in an airport;
What do you think the cost of business is for Dixons to have a site in Heathrow Airport Vs Warrington High Street?
Probably comparable with their Regent street store.

I note it is no cheaper if you buy online where they can site their warehouses in the cheapest location

iwantagta

1,324 posts

175 months

Sunday 9th July 2017
quotequote all
voyds9 said:
iwantagta said:
WHS now discount the VAT back to customers on a boarding card scan to a non VAT country.

Regarding Dixon's price being almost as high for an apple product in an airport;
What do you think the cost of business is for Dixons to have a site in Heathrow Airport Vs Warrington High Street?
Probably comparable with their Regent street store.
My understanding is that airport retail contracts will be far more expensive than even Regent Street - (NB i'm not an expert by any means on this!) they tend to work by taking a % of the sales of a product e.g. 5% of your iphone purchase goes to the airport. With a minimum annual payment guaranteed of say 500k pa.
This makes it critical to not only be selling a lot but also at a reasonable margin else all profit gets swallowed up by the % of the airport.

In addition staff - especially airside staff who need security clearance - tend to earn slightly more.
Getting product into store - all needs to be security scanned - this has to go through a defined consolidation centre at a cost to the retailer. An expensive cost as the scanning company has had to bid from the airport for the work and guarantee to pay them £££££ as well!

Probably someone on here who knows better than me on this!






Du1point8

22,925 posts

222 months

Sunday 9th July 2017
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The VAT is a rip off...

Here in Aus Im a non resident, so I can but my iPhone at $1500 or whatever it is and then when departing the country I can go and claim all the VAT (called GST) back in the TRS (Tourist Refund Service), so instead of buying in the airport, go buy at the place you visit and claim it all back.

So I guess if I technically do it in Finland next month, I can claim 25% (VAT) on an iPhone and bring it back to Sydney.


TooMany2cvs

29,008 posts

156 months

Sunday 9th July 2017
quotequote all
Du1point8 said:
The VAT is a rip off...

Here in Aus Im a non resident, so I can but my iPhone at $1500 or whatever it is and then when departing the country I can go and claim all the VAT (called GST) back in the TRS (Tourist Refund Service), so instead of buying in the airport, go buy at the place you visit and claim it all back.
And if you're a non-EU resident visiting the UK, there's a myriad of shops in High Streets offering tax-free purchasing to you.

They have nice big stickers in the doors or windows, to help attract all that tourist money in...


How it works :
https://www.gov.uk/government/publications/vat-not...

ashleyman

7,284 posts

129 months

Sunday 9th July 2017
quotequote all
I really don't like that they take away my bottle of water at security which forces me to buy a new one once I'm past that stage at a higher cost.

On a 8/9 hour flight I might want 2 bottles. Thus causing me to spend more. It's also more expensive inside the airport than outside. Not fair considering we can't go anywhere else.

Du1point8

22,925 posts

222 months

Sunday 9th July 2017
quotequote all
ashleyman said:
I really don't like that they take away my bottle of water at security which forces me to buy a new one once I'm past that stage at a higher cost.

On a 8/9 hour flight I might want 2 bottles. Thus causing me to spend more. It's also more expensive inside the airport than outside. Not fair considering we can't go anywhere else.
Or just ask the kind staff on the flight for water, they dont mind giving that out at all for free on long haul.

ashleyman

7,284 posts

129 months

Sunday 9th July 2017
quotequote all
Du1point8 said:
ashleyman said:
I really don't like that they take away my bottle of water at security which forces me to buy a new one once I'm past that stage at a higher cost.

On a 8/9 hour flight I might want 2 bottles. Thus causing me to spend more. It's also more expensive inside the airport than outside. Not fair considering we can't go anywhere else.
Or just ask the kind staff on the flight for water, they dont mind giving that out at all for free on long haul.
It's not a big deal, it's just annoying that you throw it away to then re-buy inside. I fly long haul quite a lot so I'm used to it and have learnt not to look at anything inside departures as it's usually all similarly priced or more expensive than outside. I did the whole asking staff for water but it gets boring having to ask staff for stuff all the time. I've got used to passing security, walking to the shop inside departures and buying water/snack. Every single time I still I get annoyed with the price at the till! biggrin