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Duty-free disaster threat

22nd May 1997, Page 7
22nd May 1997
Page 7
Page 7, 22nd May 1997 — Duty-free disaster threat
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Which of the following most accurately describes the problem?

• International hauliers will face a 10% rise in ferry prices and fewer sailings if the EU abolishes duty-free sales, warn transport consultants TDSTransmodal.

The duty-free system is due to end in 1999: TDS predicts that this could kill off 11 of the 26 existing routes with fewer freight crossings. Many hauliers will have to travel further to reach the nearest port, it adds.

The report was commissioned by the European Travel Research Foundation, which is funded by the airlines, ferry

companies and the duty-free industry. It says the end of the duty-free system would be devastating as it accounts for up to 45% of ferry operators' revenue and provides higher profit margins than ticket sales.

The most likely outcome would be a rationalisation of services and a 10% price increase, warns TDS: "Regions likely to be particularly hard hit are Scotland, the North and the South-West," it says. "These extra freight costs represent a barrier to the workings of the Single European Market."