Running the perfume-scented maze of the airport duty-free is a prerequisite for any vacation.
After putting the stress of travel, check-in, and customs behind you, you enter a sensory assault course with flashy whiskey displays, foreign scents, and novelty-sized chocolate bars beckoning you to reach for your wallet.
But can duty-free really live up to its reputation as an Aladdin's vault of bargain wonders?
Is it merely a myth that has been successfully marketed?
We wanted to know, so we investigated the prices of eight well-known duty-free stalwarts across a variety of categories and compared them against 12 significant airports to determine which gave the best value.
What is duty-free?
Duty is the levy you pay when you import something across borders.
This includes customs taxes and value-added taxes, which vary by nation.
In 1947, on the wild coast of western Ireland, duty-free shopping makes its debut.
Brendan O'Regan, a comptroller at the tiny Shannon Airport, which was a common refueling stop for flights carrying celebrities (the only ones who could afford transatlantic air travel at the time) between the U.S. and Europe, came up with the idea.
O'Regan understood that Shannon was missing out on a huge deal of income from these extremely wealthy bystanders.
He, therefore, convinced the Irish government to establish a tax exemption so that he could sell farm products and Irish whiskey to travelers while still paying the regular customs charges.
He contended that since they never left the airport, they shouldn't be required to pay local taxes on goods they wouldn't be using locally.
The concept caught on.
Before the idea was introduced to the United States in 1962, Amsterdam established its own tiny free-trade zone in 1957, spurred on by Shannon's success.
International travelers spent $35.87 billion in duty-free shops in 2021, according to Fortune Business Insights, and that amount is projected to more than double by 2029.
The ground rules
Since the 1940s, there has been a dramatic change in the retail industry.
Does duty-free still save you money today, with all the online deals, year-round sales, and increased competition for customers' attention?
Where can you find the best bargains, if that is the case?
We selected a select group of the most recognizable items from the most well-known brands that you would anticipate finding in any duty-free shop throughout the world.
Due to the fact that advertising alcohol or tobacco products are prohibited in some nations, including Turkey, it was difficult to get prices for some commodities online or over the phone.
In other instances, such as in Madrid, Rome, Prague, and Warsaw, the airports and duty-free shops we contacted at the time of writing did not respond to our requests for additional information about various products (cigarettes in particular).
The next step was to search for each product's lowest high-street and online costs.
We didn't include seasonal promotions or limited-time offers in our searches since we wanted to maintain parity.
We looked at the following products:
• Tennessee Whiskey Jack Daniel's (1l).
• Talisker Dark Storm Single Malt (70cl).
• Taittinger Brut Reserve or Moet & Chandon Imperial Brut (75cl).
• Hendrick's gin (1l).
• Women's Dior J'adore Eau de Toilette (100ml).
• Men's Versace Eros Eau de Toilette (100ml).
• Lipstick by YSL, Rouge Pur Couture (3.8g).
• Ray-Ban Wayfarer Folding 50 (or similar Wayfarer) sunglasses.
• A carton of 200 Marlboro Gold cigarettes.
We looked at the following airports:
• London Heathrow (LHR).
• New York JFK (JFK).
• Rome Fiumicino (FCO).
• Berlin Brandenburg Airport (BER).
• Stockholm Arlanda Airport (ARN).
• Adolfo Suárez Madrid–Barajas Airport (MAD).
• Athens Elefthérios Venizélos (AIA).
• Václav Havel Airport Prague (PRG).
• Warsaw Chopin (WAW).
• Istanbul International Airport (IST).
• Mexico City Airport (MEX).
• Dubai International Airport (DXB).
The main points
In fact, there is no set limit to how much money you can save by shopping duty-free because VAT differs from nation to nation.
Most goods and services in the UK are subject to a standard rate of 20%.
17% in Luxembourg and 22% in Italy respectively.
But there is no VAT in the United States.
It does, however, charge customers a small customs duty when they export certain goods, as is the case in the majority of nations.
Additionally, duty-free charges differ between airports based on regional expenses such as hiring staff, paying rent and rates, and paying other taxes.
As a result, they essentially have complete control over their pricing.
As a result, duty-free charges at one airport within a given nation can differ from those at another.
Here are a few things we discovered in that light:
• Never purchase sunglasses in a sunny country's airport.
• Sweden consistently ranks among the most affordable countries to purchase alcohol in airports.
• The cost of tobacco products is among the lowest at Dubai airports.
• Purchase your cosmetics and fragrances duty-free in Poland.
• At JFK Airport in New York City, never purchase Champagne.
• The best deal in town isn't typically found duty-free.
Always search online for a better deal before purchasing anything if you are serious about it.
Which airports have the priciest duty-free shops?
It may come as no surprise that Dubai has the most costly airport on average for booze and cosmetics—its duty-free shop generated $976 million in revenue in 2021.
However, it's interesting to note that JFK is the most costly airport on our list for purchasing Champagne – it costs more than $18 more than the average price for all airports we looked into.
The two locations on our list where you're most likely to need sunglasses are Mexico City and Dubai, which are both sunspots.
Which airports provide the most affordable duty-free shopping?
Of all the airports we looked into, the Swedish city of Stockholm provided the best value for alcohol on average.
A bottle of brut Champagne costs only $34 (£28) there, unlike $39 (£32) at Heathrow and $50 (£41) at the grocery store.
On the other hand, a bottle of fine Talisker scotch costs $59 (£49) in Stockholm and $74 (£61) at Heathrow.
The best price for American whisky, on the other hand, can be found in Warsaw, where a 1L bottle of Jack Daniels costs about $21 (£17), over $12 (£10) less than at Heathrow and half as much as in British shops.
When comparing prices product by product, Warsaw is also the place to find the cheapest cosmetics. Prices are consistently lower than the average across airports.
Committed smokers will find the best deals on tobacco goods in Dubai, where 200 Marlboro Gold cigarettes cost $27, which is a third less than the same carton at Heathrow and 500% less than in a British supermarket.
Which goods can be purchased online or at a mall for less money?
The truth is that, for many goods, there isn't much of a price difference between duty-free and home-purchase pricing, especially if you're willing to look around online.
The two main differences are in the price of tobacco and alcohol, which are both typically subject to high taxes and may therefore be purchased for much less at the airport.
However, the situation is more nuanced when it comes to cosmetics.
For instance, a stick of YSL Rouge Pur Couture costs $36 (£30) in British stores, the same price you would pay at Heathrow.
Rome and Warsaw are the only two airports where you could spend less than that, saving you about $3.
The same holds true for accessories like watches and sunglasses.
While airport rates might be comparable to what you'd spend in Ray Ban's central London store, we discovered that a fast online search will frequently turn up a much better offer.
What are the US duty-free regulations?
You can't just bring alcohol and perfume home from Greece in a suitcase.
However, there are rather broad restrictions on what you can bring back to the United States.
According to the website of the U.S. Customs and Border Patrol (CBP), visitors are permitted to enter the country with up to 200 cigarettes and one liter of alcohol duty-free.
Additionally, residents are permitted to import $200 worth of items without paying additional taxes.
In contrast, if you exceed your allowance, you are required to pay tax and duty on the entire value of the items, not just the portion that exceeds your allowance.
If you go over your allotment, you might additionally have to pay import VAT and customs charges.
In conclusion
You should always conduct some research before you visit to find a duty-free deal on anything that isn't booze or cigarettes.
For the reason that duty-free isn't constantly the fantastic value, it's touted as.
Particularly if you're purchasing makeup, you might find that the duty-free price is not greater than a gift set offered at your neighborhood pharmacy or beauty store. Lower-taxed items can frequently be cheaper at home than in a duty-free shop thanks to an online sale or in-store promotion.
If you're in the market for a pair of designer sunglasses or a name-brand perfume, research the price beforehand both at home and online so you'll be able to spot a good deal when you come across one while on vacation.
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