IN "L'ENFER", a recent novel by the French philosopher Gaspard Koenig, a university professor dies only to discover that hell is an eternity spent traipsing around airport duty-free shops. Others seem to enjoy the experience rather more. Travel retail has grown into a mastodon, with annual sales of $86bn before the pandemic hit. It is busy adapting by expanding beyond the airport terminal, notably in China (see Business section). As it does, its tax privileges are becoming ever more indefensible. The premise underpinning duty-free is that the mere act of crossing an international border should exempt travellers from some taxes that non-travellers are subject to. This was a questionable wheeze even when European airports lobbied for it in the 1950s. Now it is untenable. Modern tax codes typically seek to dampen inequality, but duty-free shopping hands most benefits to the well-heeled who frequently travel abroad. Taxes could usefully nudge people to be greener. Duty rebates overwhelmingly fall into the pockets of people who fly and pollute. One goal of excise tariffs is to curb the harmful use of tobacco and alcohol, but airport shopping is explicitly designed to circumvent them. As duty-free shopping has ballooned, what was once a wrinkle has swelled into a tax-avoidance scheme for jet-setters.
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