amandamcadams

I still don't understand how Duty Free works after reading this. Sounds like you have to jump through a bunch of hoops to save a couple dollars.

SpannerSpinner

Yep, depending on what country it can be entirely pointless, if you are entering a country where alcohol/tobacco is highly taxed it could be worthwhile.

It used to be very worthwhile for tobacco products in New Zealand when you could buy several cartons duty free, now that its down to 2 packets its not worth the hassle according to the few smokers I know.

In theory duty free alcohol should be a bit cheaper, but once the duty free stores bump up the margins they take to cover the high cost of airport franchise operations and customs bonded warehousing etc. it can be a bit of a wash.
I know that high end spirits and Champagne are both cheaper at the local liquor store/supermarket than at duty free in NZ.

Also, be aware that duty free stores often have the worst dynamic currency conversion rates so never agree to be billed in your home currency instead of local currency.

LondonElite

I think that's a pretty good rule to stick to, even outside of duty free shops.

djk7

From a consumer point of view, duty free is pretty simple:
1) You purchase items at the duty free shop. In most cases, only customers leaving the country can purchase DF, although as mentioned in other posts, there are exceptions.
2) You take the items with you or they are delivered to the plane.
3) You are still subject to the import/immigration laws of the country you are travelling to.

The general way duty free works is that countries allow the stores to sell product free of some or all taxes since it is not being consumed in that country (with exceptions). Back in the day, the stores passed much of this savings to the customer and some good deals could be had. Now they mostly pocket most of the savings as profit and sell mainly to people in very high tax countries, or those who assume the price is good and buy without checking. The main "hoop" to jump through is to make sure the price really is good before buying.

The only real hoop is

geirfugl

Duty free shopping basically works this way,-OK.

1.Some company pays an enourmous amount of money pr sq meter to rent space at an airport.

2.This company needs an enourmous amount of overhead to make this profitable.

3.This company relys on the fact that many people asume that prices are cheaper bcs their "duty free".

4. In some places where taxes for unhealthy things like alcohol and tobacco are very,very high this can still make theese purchases advantageous for people,if they do not want to buy the same articles in Places where their cheaper.

onobond

Comments:
1. Yes, in most western European airports I know, the rent is 50% of sales
2. Regarding previous comment , this is hardly a surprise
3. Cheaper than taxed street price, but sky high over actual price without tax.
4. In countries with high tax on alcohol and tobacco, it's almost considered a sin not to buy anything in a "Tax Free" store on your way.

To give a relevant comparison: In my mid-teens, I travelled as a passenger on a commercial cargo ship. At that time I bought a pack of 10 filter cigarettes in my country to the same price as 10x20 cigarettes of same mark on the ship. Not beeing of drinking age, so no alcohol, but the guys working on the ship payed roughly 15% of official street price back home.

So Tax Free is just reduced street price by a margin. Why do you think all airports are beeing re-built into mazes making you pass perfume/spirits/tobacco shops to allow you into the departure area?

caverunner17

The only time I've bought duty free is Guinness at the Dublin airport. Irish Guinness tastes better (smoother) than the American variant.

tmiw

At PVR they make you walk through what I think is a duty-free store immediately past security and another one immediately before the international gates. I think some airports have been doing this sort of thing for departures for a while though.

sonofzeus

Any luck using manufacturers' coupons at duty free outlets?