You will need to determine if the tax-free shopping is worth your time and money. Are these products a good deal? What should i buy?
It won’t be long before you have to make decisions.
You are on a long international flight and you are hungry. But they won’t serve dinner until the hostesses complete their “duty-free” sale.
You are walking through the airport, and there is a duty free shop every few hundred yards. A common airport mistake is to assume that these stores are stocked with excellent purchases.
Should the budget traveler set aside money for these opportunities? Finding an answer to that question can be tricky.
First, understand that duty is a generic term that describes a variety of property taxes. Once outside a nation’s borders, you can buy cigarettes duty-free at 33,000 feet or offshore. International airports skip the tax bite because they are in designated foreign trade zones.
Subtracting taxes from a purchase results in good savings. But is the product a good deal if, after taxes, it is too expensive?
Make sure you are aware of the products you are purchasing at the duty free airport terminals. Some retailers rely on consumers who think prices are low simply because they are tax-free prices and then increase the price of each item.
In Britain, the government intervened after discovering that many duty-free retailers were pocketing Value Added Tax discounts that they should have passed on to customers.
The late Suzy Gershman was a shopping expert who considered duty-free shopping “a joke.”
Frommer’s author born to shop series He said, ‘I bought duty free perfumes and found they were cheaper on Saks (Fifth Avenue). As a general rule, you are not going to save much. “
Buy tax-free opportunities very carefully. Click “next” to see some tax-free shopping strategies.
Avoid impulse purchases.
Look for items that you have valued elsewhere. Otherwise, you are at the mercy of the merchant.
Buy at the end of the trip.
Bulky purchases can slow you down, and mailing items home can reduce tax savings. Another reason for this is the shopping comparison. Is Delftware at Amsterdam Schiphol Airport a better buy than what is sold in the city? You won’t know until you’ve been to both places.
Know the rules before you go.
The European Union has eliminated many of the tax-free laws that once existed when the nations of that continent had a more individual approach to trade.
But there are bargains at the airport there (at least that’s how they are advertised) because it is still possible to circumvent Value Added Taxes (VAT). This is a type of local sales tax that you pay throughout Europe, but it is fully refundable if you are not an EU citizen.
Many people don’t know that VAT is refundable, they don’t know how to get a refund, or they just don’t want it to bother them.
The beauty of these stores is that the tax is not charged. Again, you need to be informed enough to know if the VAT-free price is lower than what is available at home.
Please note that duty free at the point of purchase does not necessarily mean that you are duty free when you get home! There are limits that your country of origin imposes on the purchases of citizens abroad. There is a tax-free total (for US citizens, it is generally $ 400-800), but spending amounts beyond that amount could result in a tax charge.
There are also specific rules for individual locales. For example, in the Virgin Islands you can buy up to five “fifths” of alcoholic beverages and return them to the United States duty free. Other ports generally only allow a “fifth”.
Are you beginning to see why the rules are worth knowing?
Please visit the appropriate websites prior to departure.
A cruise line that lists the Virgin Islands among its ports of call will likely have tax-free alcohol information on its website. The airline that offers specific bargains during the flight will also list them somewhere.
Your destination’s tourist office will tell you what’s hot in their shops and bazaars, and the duty-free rules that apply.
Don’t let shopping dominate your trip.
This might be the best advice of all. Some travelers become so obsessed with finding the perfect bargain that they miss out on many other enjoyable experiences. When that happens, you waste money, because you also waste precious time.