Us Airports: Duty-Free Shopping And You

Duty-free shopping is a retail concept that allows international travellers to purchase goods without paying certain local or national taxes and duties. These shops are commonly found in the international zones of airports, sea ports, and train stations, as well as on board airplanes and passenger ships. In the United States, duty-free shops are considered class 9 bonded warehouses, where goods are sold for use outside the customs territory. While duty-free shopping is available in US airports, it is exclusively for individuals travelling internationally. This means that domestic travellers or airport employees are not eligible to take advantage of duty-free shopping.

US duty-free rules

US airports do have duty-free shopping, but it is only available for international travellers. This is because a "duty" is a tax or fee placed on goods by government entities, and merchants who import goods and sell them to consumers who are leaving the country are not charged this duty. This allows sellers to pass the savings along to their customers, who can then purchase products at bargain prices.

In the US, a customer must be at least 21 years old to buy alcohol duty-free, and 18 years old to purchase tobacco. Federal and state regulations allow travellers to bring back one litre of an alcoholic beverage duty-free for personal use. However, states may allow travellers to bring back more than one litre, but they will have to pay any applicable Customs Duty and Internal Revenue Tax (IRT).

The Customs Duty Rate is a percentage determined by the total purchased value of the article(s) paid at a foreign country. The Harmonized Tariff System (HTS) provides duty rates for almost every item. The Customs and Border Protection (CBP) uses the Harmonized Tariff Schedule of the United States Annotated (HTSUS), which is a reference manual that provides the applicable tariff rates and statistical categories for all merchandise imported into the US.

Duty-free shop articles are only free of duty in the country in which that shop is located. Therefore, if the articles you have purchased exceed your personal exemption/allowance, they will be subject to Customs Duty upon entering your destination country. For example, if you buy alcohol in a duty-free shop in New York before entering Canada, and then bring it back into the US, it will be subject to Customs Duty and IRT.

International travel perks

One of the most enticing perks of international travel is duty-free shopping. This allows international travellers to purchase items without paying certain taxes and duties. Duty-free shops are usually located in the international zones of airports, sea ports, and train stations, as well as on board airplanes and passenger ships.

The term "duty" refers to the taxes and fees incurred when bringing a purchase across international borders. For example, if you buy a bottle of perfume in Italy, you may have to pay tax twice: once when you buy it, and again when you bring it back to your home country. Duty-free shopping means you don't pay taxes in the country where you make the purchase, only in the country you're bringing it into.

Duty-free shops offer a range of products, including perfumes and cosmetics, alcoholic beverages, tobacco products, fashion and accessories, confectionery and snacks, and gifts and souvenirs. These items are often luxury goods or premium-branded high-markup products.

It's important to note that duty-free regulations vary depending on your country of residence, travel destination, and length of stay. Additionally, some countries impose duty on goods brought into the country, even if they were bought duty-free elsewhere. It's also worth watching out for potentially high markups on duty-free products.

When returning to the US, you will need to fill out a US Customs form to declare any purchases made abroad, and you may owe duties or taxes on them if their value exceeds the duty-free exemption for the country you are returning to.

Luxury goods

In the context of luxury goods, duty-free shopping allows travellers to purchase items without paying certain taxes, such as import, sales, or value-added tax (VAT). This is because duty-free shops are considered to be in a ""no man's land," where travellers are neither entering nor exiting a particular country. However, it's important to note that duty-free shopping is only applicable when leaving one country and entering another, and the purchased items are meant for export only.

When it comes to luxury goods, duty-free shops offer a range of products, including high-end jewellery, watches, designer fashion, and upscale tourist items from the host country. For example, Burberry, Chanel, Louis Vuitton, and Rolex are some of the luxury brands available at Incheon International Airport in South Korea. Heathrow International Airport in London boasts over 500,000 square feet of duty-free shopping, featuring British designers like Cath Kidston and Paul Smith, as well as international designer brands.

In addition to luxury goods, duty-free shops typically offer a wide range of other products, including liquor, tobacco, chocolates, perfumes, cosmetics, and electronics. It's worth noting that some items, such as alcohol and tobacco, may be limited in quantity when bringing them back to your home country. Additionally, certain foods and seeds may not be allowed to pass through customs in some countries, such as the United States.

While duty-free shopping can provide significant savings, it's important to be aware of potential drawbacks. Some items, such as leather goods, sunglasses, and fine watches, may be overpriced in airports. It is always a good idea to research prices before making a purchase to ensure you are getting a good deal. Additionally, remember that you may still need to pay customs fees or duties when importing luxury goods into your home country.

Alcohol and tobacco restrictions

Alcohol

US citizens and permanent residents must be 21 or over to import alcohol into the US. The quantity of alcohol that can be brought in without a license depends on where the traveller is arriving from. For those returning from a foreign country (except Mexico) after less than 48 hours or more than once in a 30-day period, the allowance is $200 worth of items, which can include 150ml of alcohol. Travellers returning from a Caribbean Basin Initiative (CBI) country are allowed up to $800 worth of dutiable items, including two litres of alcohol, one litre of which must be produced in a CBI country. If returning from the US Virgin Islands, American Samoa, or Guam, the allowance is $1600 worth of dutiable items, including five litres of alcohol, four litres of which must be purchased in one of these territories, and one litre of which must be a product of that territory.

Tobacco

Again, only travellers aged 21 or over can import tobacco into the US. Visitors to the US for over 72 hours are allowed up to $100 worth of tobacco products as gifts for others, which can include 100 cigars. This allowance can be used once every six months. For travellers returning from a CBI country, the allowance is $800 worth of dutiable items, including 200 cigarettes. If returning from the US Virgin Islands, American Samoa, or Guam, the allowance is $1600 worth of dutiable items, including 1000 cigarettes, 800 of which must be purchased in one of these territories.

Tax exemptions

Duty-free shopping allows international travellers to purchase items without paying certain taxes and duties. The term "duty" refers to taxes and fees paid for bringing a purchase across international borders.

In the context of airports, duty-free shops are typically located inside international terminals after the security area. These shops sell a range of products, including perfumes, cosmetics, alcoholic beverages, tobacco products, fashion accessories, confectionery, gifts, souvenirs, and local goods.

Duty-free shopping is exclusively for individuals travelling internationally. Domestic travellers and airport employees are not eligible for duty-free purchases. To complete a duty-free transaction, individuals must present their boarding pass.

The United States considers duty-free shops as Class 9 Bonded Warehouses. While some duty-free stores in the US may sell goods to domestic passengers, taxes are included in the purchase price for those transactions. Alcohol and tobacco products are restricted to international passengers only and are subject to age limitations.

Frequently asked questions