UAE/SINGAPORE. Travel tech start-up utu has announced a strategic partnership with Emirates which it claims “signals the biggest upheaval in the history of tax-free shopping”. The tie-up allows the airline’s shopping passengers to quickly and easily process Value-Added Tax (VAT) refunds from their phone and increase their refund by +25%.

This is achieved by leveraging the virtual utu Tax Free Card in the utu Tax Free app, allowing Emirates Skywards members to increase their VAT refund value by 4167 Skywards Miles for every US$100 refunded.

Emirates Skywards Divisional Senior Vice President Dr Nejib Ben Khedher (left) and utu Co-Founder and CEO Asad Jumabhoy pose for an agreement signing ceremony 

Through utu’s model, tourists can increase their tax refunds from shopping with rewards including Frequent Flyer Miles, hotel points, restaurant vouchers, retail loyalty points and more.

Tax-free shopping is currently available in 50 countries including France, Italy, Germany, Singapore, South Korea and the UAE. It allows travellers to claim back the VAT or Goods & Services Tax (GST) for purchases in countries they visit.

“The tax-free shopping scheme was originally introduced for the benefit of travellers, and it is time we revert back to the original aim by driving industry innovation” – utu co-founder and CEO Asad Jumabhoy 

However, utu claims that although the system was introduced as a way to boost tourism revenue in local economies, it has, over time, fallen out of favour with travellers. It said that by the time a refund is processed by VAT Refund Operators (VROs), shoppers currently only receive about half of the total value of the VAT refund they are due.

Emirates Skywards Divisional Senior Vice President Dr Nejib Ben Khedher said: “At Emirates, we pride ourselves on putting customer wellbeing at the heart of everything we do. Not only does this translate into a loyal following of discerning members, it is also the reason why we constantly strive to reinvent and innovate our experience offering.”

Blazing a trail: Emirates has become the first airline to partner with utu on the digital VAT refund scheme

He added: “utu is an exciting and fresh new company founded on a bedrock of industry expertise. It is set to disrupt the tax-free shopping sector by introducing a reward element to the process and we are looking forward to working with utu on a number of reward and loyalty initiatives as part of our strategic partnership.”

utu co-founder and CEO Asad Jumabhoy said: “We are excited to be working with Emirates to help drive a shift in the VAT refund market that will make the shopper the main beneficiary of the tax-free shopping scheme.

Travellers can avoid queuing for VAT refunds by following a simple process on the utu Tax Free app

“Adding Emirates Skyward Miles to the launch of virtual utu Tax Free Card in the utu Tax Free app is a fantastic first step in our partnership and we are looking forward to extending the ecosystem for the benefit of loyal customers.

“The tax-free shopping scheme was originally introduced for the benefit of travellers, and it is time we revert back to the original aim by driving industry innovation.”

To celebrate the launch of this industry-first proposition of rewarding VAT refunds, Emirates Skywards and utu are offering 5001 Skywards Miles for every US$100 of VAT refund starting from now until 31 March 2022.