Duty-free allowances to change under new treaty rules

When the treaty comes into force, a new duty-free allowances regime will apply to purchases of goods by individuals, provided these consist exclusively of items for the personal or family use of travellers, or goods intended as presents.

The allowances will be set at €430 for travellers arriving by sea or air and €300 for those travelling by land. Standard quantitative limits will continue to apply to tobacco products, alcohol and fuel.

For travel between the EU, for example Spain, and Gibraltar, this regime will apply for an initial period of three years. It will be permanent for travel between Gibraltar and non-EU countries, such as the UK.

During the initial three-year period for travel between the EU and Gibraltar, persons travelling with goods within the duty-free thresholds will only pay tax at the place of purchase.

With regard to travel between the EU and Gibraltar, during those initial three years, persons travelling with goods within those thresholds will only pay tax at the place of purchase. If they travel with goods above those thresholds (which they can) they will be able to get a refund of the tax paid at the place of purchase (whether transaction tax or VAT) and then pay the VAT (if going to Spain) or transaction tax (if coming into Gibraltar) on those goods. There will be a counter at the airport where persons travelling with goods above the thresholds can make the relevant declarations.

There will be no Customs controls at the land frontier during this period.

After the initial period of three years, the allowances regime will disappear altogether, and persons can travel between Gibraltar and the EU with any quantity of goods so long as they can justify that they are for personal use or a gift.