Sunday 20 January 2019

How Brexit could spark the return of the infamous 'booze cruise' to the UK

CALL OF DUTY-FREE: The reintroduction of duty-free on trips to the UK could be worth more than €45m to the Irish economy. Stock picture
CALL OF DUTY-FREE: The reintroduction of duty-free on trips to the UK could be worth more than €45m to the Irish economy. Stock picture
Wayne O'Connor

Wayne O'Connor

A hard Brexit would lead to the return of the infamous 'booze cruise' to the UK, with extra passengers expected to board ferries in search of duty-free alcohol, a leading academic has said.

It is estimated that the return of duty-free on trips to the UK would be worth more than €45m to the Irish economy, with Dublin Airport saying it would be Brexit's only silver lining.

Regional airports and local distilleries would also be expected to benefit heavily from the reintroduction of duty-free for flights to the UK, but retailers fear it could have stark consequences for them. While Brexit is seen as a hugely negative step, airports conceded that the reintroduction of duty-free for passengers leaving Ireland for the UK would be the only positive.

"Overall, Brexit is a negative and we view it as a negative for our business but the only positive is the potential return of duty-free for passengers travelling to Britain," a Dublin Airport Authority spokesperson told the Sunday Independent.

As Britain edges toward crashing out of the EU in March without a deal it is more likely that duty-free will return for journeys between the UK and Europe. This would be on a temporary basis if a deal is reached after March. However, many within the duty-free industry expect it to become a permanent fixture after Brexit is completed in 2021 if a deal is reached.

Dublin City University associate professor of economics Anthony Foley said the return of duty-free would be an opportunity for shoppers to take advantage of cheaper prices on alcohol, cigarettes and cosmetics.

"Previously, when we had duty-free we used to see these ferry trips that would go across to Holyhead and fill up with booze. That will be a likely avenue," he said.

"If Britain does allow duty-free then you would expect a significant increase in purchases because of the high excise and VAT rates on alcohol and cigarettes. With a hard Brexit, you have the likelihood that duty-free will be available as it is with non-EU destinations at present."

Most airport retail units already implement a dual pricing structure on duty- free products for passengers travelling to the US, Iceland and the Canary Islands so it is thought they will be able implement concessions for travellers to Britain immediately after Brexit. Mr Foley, in an impact study for the Irish Duty-Free Alliance, said this would create at least 450 new jobs and showcase domestic products. However, retailers are concerned about the impact that the return of duty-free will have on them.

"It does have the possibility of distorting the market. With that comes a challenge because it would be cheaper for people to shop in a duty- free environment rather than traditional high street stores," said Retail Ireland director Thomas Burke.

Sunday Independent

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