Duty free shops are not the cheap havens for buying booze, perfume and trinkets that they are cracked up to be for many expats.
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Although at least one in three travellers browse the aisles in duty free shops, in many cases the prices are not the bargains they seem to be and in many cases, those impulse purchases can cost more than shopping at home.
Take buying an iPad Pro 12.9 inch wi-fi with a 256Gb memory.
Expats would think that the iPad would cost the same wherever bought – but that’s not quite how the pricing works.
The Apple Price Index looks at the cost of gadgets with the same specification in 12 countries.
Cheapest iPad
The cheapest iPad Pro costs $1094 in Hong Kong but $1439 in France and $1428 in Germany.
That’s a difference of $345 (24%) between the least and most expensive recommended retail price without any sales taxes.
Germany is the second most expensive – but still $11 less than in France even though both countries share the euro at the same rate of exchange.
Another Apple Price Index linked web site, the Duty Free Addict, helps expats and travellers compare duty free prices for must-have purchases.
For instance, if you live in London and are travelling to New Delhi, where is the cheapest duty free shop to buy Grey Goose premium vodka?
Duty free rules
The web site returns a price of $59 in London and $49 in New Delhi. However, the cheapest is $29 in Canada, while the most expensive bottle is in London.
Duty free shopping lets international travellers buy goods without tax or by claiming a refund.
“Taxes vary by country and sometimes even by state or province within a country. Firstly, you need to determine whether the quoted price includes or excludes tax. Then you need to determine what the applicable tax on the product is, whether the country offers a tax refund scheme and finally how to claim the refund,” says Duty Free Addict.
Some countries also impose a minimum purchase for reclaiming tax – for example, 25 euros in Germany but AUS$300 in Australia.
Other quirky rules can apply – for instance expats or travellers returning to Britain exceeding the 200 cigarette, a litre of spirits and two litres of wine limit have to pay duty on the entire amount of their purchases.
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