North Americans travelling abroad often pay taxes that are bundled into the prices of goods and services.
asserted
that → travel → goods
They are widespread among European Union countries and even charged on hotel rates and restaurant meals.
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They → charge → rates
On consumer goods that visitors to Europe plan to take home, the taxes are refundable upon departure.
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taxes → plan → departure
Value-added taxes — or VAT — in Europe are charged at the national level and accumulate at each phase of production, marketing and distribution, so a shopper may not be aware they’ve been added.
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they → add → production
VAT tax rates and minimum thresholds for qualifying purchases vary by country.
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rates → qualify → country
Across Europe, VAT rates range from 8.1% to 27% and average 21.9%.
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rates → range → %
Many countries impose a minimum purchase value from a single vendor to be eligible for a VAT refund.
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countries → impose → refund
Spain, where there is no minimum to apply for a refund, is an exception.
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Spain → be → refund
The guidelines in France are more typical; there, consumers must spend 100 euros at a participating retailer, where the purchase can be a single item or several rung up together.
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purchase → spend → retailer
Because the process is not synchronized by the European Commission, the executive branch of the European Union that oversees national tax rules, procedures vary and can be confusing.
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procedures → synchronize → rules
While travellers should check with the retailer for specific instructions, here are the steps to take in order to get a VAT refund in Europe.
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steps → check → Europe
According to a spokesperson at the European Commission, VAT refunds are available for certain goods, “namely those that can be carried in personal luggage.”
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that → accord → luggage
Big-ticket items like cars and yachts are excluded and individual countries may also exclude specific items.
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countries → exclude → items
Shops that participate in tax-refund programs usually have an identifying sign in the window or at the register.
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that → participate → register
The goods must be new, so don’t expect a tax refund on a vintage vase; and unused, so if you buy a ski jacket in Cortina d’Ampezzo and use it while skiing there, it’s ineligible.
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it → expect → it
A vendor may even wrap and seal your purchase, preventing you from using it while you are travelling in order to qualify for a refund.
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you → wrap → refund
In addition to the receipt, make sure you get a VAT refund form from the shopkeeper, showing the transaction date.
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you → make → date
Retailers must verify citizenship using the buyer’s passport, so make sure you have it with you when shopping.
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you → verify → you
Be timely
Tax refunds are available only on items taken out of the European Union within three months of purchase.
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refunds → take → purchase
You may move between member countries within that window, but can apply for a refund only when you are leaving the European Union.
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you → move → Union
File at the point of departure
Foreign travellers can apply for a tax refund at their point of departure from the European Union.
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travellers → file → Union
This may be the Eurostar train station in Paris for an England-bound express train.
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This → bind → train
For most North Americans, the point of departure will be an international airport where they can expect to find VAT refund desks near customs or currency exchanges.
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they → expect → exchanges
Travellers must have their refund application stamped by a customs agent who may ask to see the item you purchased.
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you → stamp → item
Be prepared to pack anything you’ve purchased and hope to get a refund on in your carry-on bag.
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you → pack → bag
Sometimes customs offices handle the refund.
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offices → handle → refund
At other times, travellers must use services such as Global Blue and Planet to expedite their refund filings, for a fee.
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travellers → use → fee
(Shops or services that offer automatic tax refunds at the point of sale usually require travellers to send their stamped customs forms in, or risk having the refund rescinded.
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refund → offer → forms
Refunds are usually offered in the currency of the country you are departing.
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you → offer → country
They can be made in cash or to the credit card used for the purchase.
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They → make → purchase
Because of the many steps involved in applying for a refund — and the lines at refund desks — travellers should allow extra time at the airport or train station.
Declare your purchases to Customs at home
Depending on what you’ve purchased, you may have to declare the value of the items you are bringing home to Canada Border Services Agency and pay any associated fees.
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you → involve → fees
Look for refunds in Asia and Africa
Europe isn’t the only place to look for value-added taxes and their refunds.
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Europe → look → taxes
More than 170 countries charge value-added taxes or their equivalent.
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countries → charge → taxes
Not all of these are refundable to North American travellers, but many countries in Asia, Africa and Latin America offer refunds.
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countries → offer → refunds
Alexander Smith, an associate professor of economics at Worcester Polytechnic Institute in Worcester, Massachusetts, said he recently applied for and received refunds for purchases in Japan, which was seamless, and in South Africa, where he nearly missed his flight trying to complete the paperwork.
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he → say → paperwork
“Ten, 15 or 20% on a small purchase may not be worth it but if you have something of value, it can be a nice discount,” he said.
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he → have → value
The Aporia
