Duty on 'Duty Free'?
Yes, as far as rules go, you may have to pay duty on the duty-free goods you purchased when you enter your country. A resident of the U.S. returning from abroad will have to pay a minimum of 3%, if his duty-free purchases exceed USD 800.
It's a bummer when you're finally hit with the realization that duty free isn't what it means, and the guys running the store are not in it for the goodness of their hearts. They're hoping to make a profit off you―yes you, who's returning home from a stint abroad without bearing gifts. Duty free is another one of those phonies (albeit not one of deceivingly epic proportions) where you think you've nailed a bargain, but you're actually getting a teensy discount on already-escalated prices.
But it's not all that bad, really, and there are certain ways in which you can effectively profit from it. In order to pull off a splendid bargain, here's what you can actually do.
Duty-free Shopping Guide
Designer handbags, exquisite fragrances, delicious chocolates, and yes, even works of art―what's not to love? Duty free is the one place that tries to make the most of our end-of-the-holiday woes by shoving up these delights into our faces. It doesn't matter if it's for gifting or personal use, we invariably end up shopping here. But if you're looking for a bargain while doing so, these are the tips you ought to keep in mind.
Take the effort to calculate.
In case you're looking to make a really expensive purchase, like a Chanel or a Bottega handbag that's sure to cost you USD 1000 upwards, be in the know about how much it will cost you, overall. Do a quick online search to find out the cost of the piece, and the net total if you have it delivered within the US. Then, compare it to the one you're eying in duty free. Remember, that above the $800 duty-free exemption for US travelers, a flat rate of 3% is imposed on the next USD 1000 of purchase. Beyond this sum of USD 1000, calculation gets complex, since variable rates are applicable. Many a time, you end up discovering that when it comes to big shot items like these, it's better to order or purchase them within the US.
'Local' does not necessarily indicate 'cheap'.
So you believe that buying a swanky Swiss watch in Switzerland will be cheaper? Not always. Here again, you'd be surprised to know that you stand a better chance of purchasing the same Tissot or Omega at Macy's than at a Geneva duty-free store.
Having said that, cruise ships have been known to offer some amazing steals in their duty-free bargains, especially on high-end watches. This includes a dip of 10% to 15% apiece, which sure is a clean deal.
It's okay to pay big bucks for exclusivity.
Handmade clogs at the Amsterdam Airport, a local brand of Dijon mustard from the CDG Paris, or chocolate-dipped stuffed dates from the Dubai Airport―these are the things that scream 'exclusive', and no matter what you do, it would be hard to find these in your home country. These are the times when you can let go and indulge, as finding these at home would be real tough. Things you can skip can include the same old Toblerones, Lindts, and Ferrero Rochers, which can be bought on the cheap at your nearest supermarket.
Go for the big savings on smokes and spirits.
Ciggies might be variably taxed across each state in the U.S., but the bottom line remains that these taxes are sky-high. Which means that there are solid chances of you scoring a bargain when you purchase these at a duty free abroad. Get a load of this―a carton of Marlboro Reds that costs close to USD 100 in New York can be bought at around USD 60 at the London Heathrow. Mind you, you are only allowed to bring in one carton; any more and you'll witness a rather painful confiscation.
In case of wine and liquor, those over the age of 21 are allowed to bring in a liter per person in the U.S., and those coming from the U.S. Virgin Islands or other Caribbean countries are entitled to more. But since alcoholic beverages too are heavily taxed across the country, it does make sense to buy it abroad.
Before you launch yourself headlong into the temptations of duty-free shopping, educate yourself about the rules and regulations regarding the applicable exemptions. Beyond that, it's just 'happy shopping' all the way!