Duty-free changes: Cigarette, alcohol and VAT rules for travellers from 2021
Cheaper cigarettes, long-haul travellers able to bring in 69 litres of alcohol, but inbound tourism hit by removal of VAT refunds for visitors – the new government rules from 2021 will transform the duty-free landscape.
These are the key questions and answers.
What are the rules right now?
From the UK, anyone heading to a non-EU destination is able to buy alcohol and tobacco free of duty, and all other goods free of VAT.
Coming in to the UK, “you can bring in an unlimited amount of most goods,” says the government.
The conditions are that you must transport them yourself; intend to use them yourself or give them away as a gift; and have paid duty and tax in the country where you bought them.
Note that the Canary Islands, the north of Cyprus, the Channel Islands and Gibraltar are regarded as outside the European Union for customs’ purposes.
How will things change when leaving Great Britain in 2021?
For those leaving Great Britain (England, Wales and Scotland) for EU countries, duty-free alcohol and tobacco will apply – but the European Union’s customs rules will come into play from 1 January 2021.
The limits are: 1 litre of spirits; 4 litres of still wine; 16 litres of beer; 200 cigarettes; and €430 (£398) in other goods.
When travelling from Great Britain to destinations outside of the EU, VAT will now be applied on all other goods. At present, holidaymakers heading for Turkey will pay only £5 for a bottle of sunscreen that normally costs £6. That price will rise.
In addition, it will no longer be possible to buy electronic gear, clothing, etc, free of VAT and bring it back to the UK.
Foreign visitors returning home will no longer be able to claim back VAT on shopping in the UK – but they will be able to avoid tax on goods sent direct to their overseas address.
What about coming back?
The freedom to bring back anything from Europe will end. Instead, new worldwide limits will apply for goods brought into Great Britain.
The government promises “one of the most generous allowances anywhere in the world” for alcohol and tobacco.
The limits will be 42 litres of beer; 18 litres of still wine; and either 4 litres of spirits or 9 litres of sparkling wine.
The government says the savings will be £2.23 for a bottle of wine; £2.86 for a bottle of champagne or prosecco; £11.50 for a litre of spirits; and 38p for a can of beer.
Cigarettes (maximum 200) or tobacco (250g) should be much cheaper.
In addition, you can bring in other goods worth up to £390.
If passengers bring in goods over their allowance, they must declare them. Passengers will need to declare and pay tax on all goods they are bringing in within the relevant category, not just those that exceed their allowance within that category.
Some countries have duty-free on arrival. Will that happen here?
No. Duty-free on arrival avoids (for example) whisky being sent from the UK to Dubai and being brought back. It reduces the environmental impact by lowering the weight of aircraft.
But the government has rejected the concept and is instead inviting arrivals from long-haul destinations to bring in 69 litres of booze, at considerable environmental cost.
What about Northern Ireland?
Nothing here yet applies to Northern Ireland. The government says: “The government continues to work with the Joint Committee on the implementation of the Northern Ireland Protocol.
“The government is also committed to providing guidance on how the Northern Ireland Protocol will work, including for duty-free and tax-free goods, ahead of the end of the transition period.”
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