Guest Author - Lisa Shea
Duty Free shopping means that the items you buy are not subject to customs taxes. It can be an important way to save money on any international trip.
In essence, you tend to pay tax on anything you buy, anywhere. The tax is the way the local government has to collect money to pay its bills. If you are hanging out in England and buying sweaters, you pay the English tax on them. If you're in New York and buying fritters, you pay the New York tax on that.
The exception is a duty-free shop. These shops are generally in high tourism areas and are for things that they don't expect you to ever use locally. Therefore they give you a lower price, because the local government assumes that you aren't going to be there when you use the item so therefore why should you pay tax on it? If for example you buy a bottle of Champagne in the French airport on your way home to the US, you are probably intending to drink it at your house in the US. You can therefore buy the bottle in a duty-free shop, have it specially wrapped to ensure you don't drink it before you get on the plane, and then carry it still wrapped through customs.
Savvy travellers build entire lists of which items are cheapest in which duty-free shops in which parts of the world. Let's say Champagne is super-cheap in France and that you can buy it at a duty free shop for only 1/2 price compared either to normal shops in France or shops in the US. You therefore could buy a ton of Champagne in that duty free shop, bring it all home with you, and be set for quite a while. Of course this only works if you like Champagne :)
That being said, a duty free shop is NOT a license to buy unlimited supplies of anything. Yes, you are not paying tax on the item - but you are still restricted by your home government as to how much you can bring in before YOUR government starts imposing its own tax. They are fine with you bringing in a few items for yourself - but if it looks like you're planning to set up a shop as a Champagne Seller when you return home with your 400 cases of Champagne, they are going to tax you for that.
So check out the bargains at the duty-free shops, make your plans, and enjoy your trip! Always know what the customs limits are, though, so that your return back home goes smoothly.