HC Deb 24 November 1983 vol 49 c440
2. Mr. Aitken

asked the Chancellor of the Exchequer what steps he is taking to safeguard the future of duty-free sales on cross-Channel ferries in the light of cases pending before the European Court of Justice; and if he will make a statement.

The Minister of State, Treasury (Mr. Barney Hayhoe)

The Government believe that VAT and excise duty-free sales for intra-Community travellers should be retained. The European Court has been left in no doubt about our views, and we shall also be pressing for the early adoption of the Commission proposal to put these safes on a firmer legal basis.

Mr. Aitken

While thanking my hon. Friend for that reply, may I ask whether he is aware that any EC ban on duty-free sales, or even a reduction in duty-free allowances of the sort proposed in the Commission's seventh draft directive, could result in a serious loss of revenue for British shipping companies, airlines and the British Airports Authority? Is he further aware that such a loss of revenue could, sooner or later, result in higher fares for passengers and higher costs at ports and airports? Will he vigorously defend the present duty-free arrangements?

Mr. Hayhoe

We recognise the points properly made by my hon. Friend. That is why we are determined that duty-free sales should continue.

Mr. Robert Atkins

Will my hon. Friend consider making available at the places where duty-free goods are sold information showing exactly what duty is not being charged, so that a prospective purchaser will know exactly what he is saving?

Mr. Hayhoe

That must be a matter for those concerned at the various sale points. It is true that the prices charged are well above a price that would be determined merely by reducing the usual price by the element of tax and duty.