Tips for Duty-Free Shopping

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It’s just about impossible to take an international trip without noticing the heady array of luxuries, ranging from chocolates to designer clothing, at the duty-free shops set up in the airport. Tens of billions of dollars of commerce flow through duty-free shops each year, and the industry continues to grow. However, while duty-free shops do offer some deals, you need to shop intelligently to make the most of them. Consider the following tips to save money when shopping for duty-free items:

Know your exemption.

The value of the goods you can bring into your home country without paying import duties varies, and if you exceed it, you’ll end up paying taxes even on items purchased from a duty-free shop. U.S. citizens can bring back up to $800 worth of goods from most foreign countries, with additional limits on the number of cigarettes and volume of alcohol allowed.

Know the taxes.

Buying duty-free items that are normally taxed heavily in the U.S. will save you the most money. You can often save significantly on alcohol and cigarettes up to your exemption, especially in areas like the European Union, where airport duty-free shops are also exempted from collecting any Value Added Tax.

Know the prices back home.

Don’t assume that you are saving money just because an item comes from a duty-free shop. Some luxury items actually cost more at the shops, while others offer significant savings.

Beware of designer luxuries.

Handbags, in particular, may not be such a great deal. Some designer handbags cost more at duty-free shops than they do at online merchants, and if you’re buying a $2,000 bag, you’ll probably go over your exemption and have to make headache-inducing calculations and pay duty tax when you get home.

Think about more than savings.

Some duty-free items don’t offer great savings, but they do make excellent last-minute gifts or souvenirs. Chocolate in duty-free shops tends to be lightly discounted, but you may find treats there that you can’t find anywhere else.

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