Duty free shopping

Duty free shopping is the opportunity to buy goods exempted from taxes and excises at certain locations. Travellers bound for countries with heavy taxation can sometimes save a considerable amount of money, especially on products such as alcoholic beverages and tobacco. Even if you do not partake yourself, these products may make good gifts.

"Luxury" commodities such as perfume, cosmetics and candy used to be subject to special taxes in many countries. They can still be found in many duty free stores, though the discount is rather low, only representing the value-added tax.

However, such stores are not necessarily the cheapest places to buy the goods in question. This is because those stores pay high rents for airport retail space, face limited competition, and generally do not rely heavily on repeat business, so there may be little incentive for management to set competitive prices. Commonly in New York or Hong Kong, prices on items like cameras can be better in the highly competitive market downtown than at the airport (Hong Kong also has no sales tax, so nothing to deduct for these). Also, not all such stores are really "duty-free"; the Ottawa airport, for example, sells cigarettes marked "Ontario taxes paid", and Ontario taxes are high so their prices are well above those in some US states. If you are used to adding the tax to the published price, note that in many countries the tax is included, so if the price shown is the same, you just pay the shopkeeper (or their landlord) instead of the government.