The Case For Abolition

Duty-free sales are an anachronism in the single market. It makes as much sense to have them for travellers from Dublin to Cork as Dublin to Rome.

They distort competition, providing subsidies for the travel industry in a totally unstructured way. If subsidies are required, they should be directed in an organised way towards those who need them.

They cost the EU taxpayer £1.5 billion a year in unpaid taxes and excise duties.

They benefit the well-off, who can afford to travel, at the expense of less well-off taxpayers who buy the same goods at much higher prices.

Retaining them is an inducement to buy tobacco and alcohol in direct contradiction of EU policy to reduce consumption of these products on health grounds.

They subsidise air travel, the most polluting form of transport.

US-style shopping malls can be developed at EU airports with duty-paid goods. Airports, airlines and ferries have a growing "captive market" to sell to.

The duty-free industry had nearly eight years to prepare for abolition.

Surveys show that, with the exception of drink and tobacco, duty-free shop prices are often higher than those downtown.

The Case For Retention

Duty-free sales provide crucial revenues to airports, airlines and ferry companies, helping them to keep fares down.

Jobs will be lost if abolition goes ahead. A study currently being completed says 11,000 Irish jobs are dependent on the duty-free industry.

The benefits of duty-free are being sacrificed for the sake of an EU economic principle.

Passengers enjoy duty-free facilities.

The 1991 decision to abolish duty-free within the EU was based on the assumption that full tax harmonisation would be in place in 1999. In fact member-states' tax policies are more divergent than ever.

The European Commission has never carried out a detailed assessment of the impact of abolition.

It supports one of the EU's four cornerstone freedoms the free movement of people.

Duty-free sales give peripheral memberstates like Ireland a level playing field with rival exporters by contributing to lower transport costs.

The gains to the Exchequer from abolition would be negligible, as many duty-free purchases would simply not be made if VAT or excise was added.

Non-EU destinations would continue to benefit from duty-free and thereby gain a competitive advantage.