Republic and UK to allow duty-free shopping in no-deal outcome
CONSUMERS travelling between the Irish Republic and Great Britain will be able to avail of cut-price alcohol, cigarettes and perfume in the event of a no deal Brexit.
But the bad news is that duty free shopping will not apply to passengers on the island of Ireland, between north and south, and there will be no duty-free regime for passenger travel between the two jurisdictions on the island.
For people travelling from Great Britain to the Republic, the price of a packet of 20 cigarettes will be as little as €3, while alcoholic spirits will also be dramatically cheaper.
However, the rare upside to Brexit for shoppers will come at a major cost to the Irish exchequer and retailers. The return of duty free shopping for people flying or sailing to GB will reduce the Irish government’s coffers by around €350m a year even before the related economic impact on the retail sector is taken into account.
The Dáil had passed legislation to continue restricting duty free sales after the UK leaves the EU — but a decision in London means it will not now be implemented.
The UK Chancellor revealed the he intends to reintroduce duty-free shopping for passengers travelling to EU countries if the UK leaves the EU without a deal on October 31. As a result, the Republic will not put in place facilities to collect taxes for the UK.
It could mark the return of the so-called ‘booze cruise’ where day-trippers take a boat trip in order to stock up on cheap alcohol and cigarettes.
Irish Finance Minister Paschal Donohoe confirmed that in a no deal, the UK will assume the status of a ‘third country’ in terms of its trading relationship with the EU. He said: “The effect of the announcement by the UK Government today on the return of duty-free shopping between the UK and EU Member States means that Ireland in respecting our international obligations will, as intended, reciprocate the UK Government’s decision and facilitate duty-free purchases for passengers travelling from Ireland to UK ports and airports.
“Passengers to Ireland purchasing duty-free goods in the UK must adhere to the personal consumption limits set out in EU law.”
While the Irish government is reluctantly allowing the return of duty-free, the UK is using it to show consumers what they see as the upside of Brexit.