Two Words: Import Duty
Let us imagine we got money. I don’t. maybe you do. but I don’t.
and we’re in the mood to buy some Prada, some Gucci, some Chanel, some Louis Vuitton and some Ferragamo. These are all Italian and French brands.
A trip to European Union (EU) may be worth it just to avoid the duty. An import duty is a tax collected on imports by the customs authorities of a country. When Italy sends all of their fashionable excellence to the U.S., the U.S. has to pay Italy for sending such prestige for your consumption. That cost gets forwarded to us.
We (Americans) may pay a little less for our iPhones than the rest of the world, but a little more for all that is European fashion.
Now, look at these amazing Ferragamo heels I tried to convince myself to buy.
$1250 for Americans, but €950 for EU members. The Euro is at an all time low, and nearly equivalent to the USD. It’s a great time to go shopping.
Just by travelling to Italy, you’re saving approx. $300 on these shoes. In fact, my roundtrip ticket to Milan was only $515…so….worth it or no? (Are you booking your flight now?)
Not to mention VAT.
VAT is Value Added Tax.
VAT is across the European Union, and guess what, Non-EU Residents don’t have to pay it. In the store, you will pay tax, but as a non-EU citizen you’re eligible for a refund for the taxes you paid (to an extent)
EVERY TIME you go shopping, you must:
- Ask about VAT return form (407) – every store has a different policy, be SURE to ask. – some stores gave 23% back, some I went to only gave 8%, just ask. and you typically have to spend about €120 to qualify.
- Bring your passport because they will ask to see.
- The store will give you a form, WHICH YOU MUST KEEP
- Once you leave that country, you can get your money back IN CASH at the airport just make sure you have the item you purchased.
*sometimes they ask to see the items you bought (most of the time they don’t)
I found this article which explains it pretty straight forward.
What I Actually Purchased.
It was a windy day in Madrid & I was sitting on a bench people watching when I saw these beautiful sunglasses. A blonde woman, about 60-70 years old walks by wearing a red mink coat, and bright orange lip stick. She was fabulous. And So Were Her Glasses.
I thought about them my whole trip. Went to the department store, found them and stood around thinking to purchase. I tried to convince myself of the savings. $360 down to about approx. $250, It’s a steal! But I reconsidered, I thought…who do I think I am? $250 on sunglasses? Have a seat because you don’t have it like that.
I couldn’t do it.
Not until Milan.
You see, when I was in school in China I made loads of Italians friends. & 2 of them live in Milan.
And BOTH of them work in retail. Which meannnnssss, DISCOUNTS.
My girlfriend works for the Prada Group. Do you know the discount Prada Group Employees receive?
So €230 Euros, just became €161 – and after my VAT Return, just €150
OK well that’s it. I’m buying them.
When you’re in Italy, and your Italian friend has the hookup. You. Do. Not. Say. No. Even if I didn’t have the plug, it’s still a savings.
Lesson: If you’re continuously buying European goods, just go to Europe.