It's your first trip to Europe, and you're getting a little carried away with your shopping list: British tweeds, Austrian crystal, Italian gold jewelry, Scandinavian fur accessories.
What may not have occurred to you is that if you spend $1,000 in each of three or four countries abroad, you could pay up to another $1,000 in sales taxes on your purchases. But you can get most of this money back if you take a few simple steps.Several paths can lead to a refund of the so-called value added tax (VAT), which ranges from about 6.5 to 25 percent. It's built into most retail prices abroad. Tourists don't have to pay tax on purchases they have shipped directly to their home - or to anyone else in America. Otherwise they usually have to pay the tax, then document the fact that they deserve a refund to prove they're not making tax-free purchases for friends who live abroad. The 15 countries of the European Union require visitors to obtain export certification from a customs agent at the end of their entire trip.
Requirements vary, and you might not always get back your entire tax outlay. Individual countries, and even stores, may set the minimum purchase required before they'll offer a refund. Some levy a service charge for the paperwork. And some shops, particularly small ones, don't provide VAT refunds at all. Always ask before you buy anything if the store stocks the required government refund forms - or if it participates in the refund program provided by any of several private companies that, for a commission, provide one-stop rebates for all your qualifying European purchases.
A number of companies, such as Chicago-based Europe Tax-Free Shopping, handle VAT refunds in one handy airport transaction. To claim refunds through ETS, you must shop at stores displaying the "Tax Free for Tourists" logo and ask the sales clerk to fill out a Tax-Free Shopping Cheque when you make your purchase. When you're leaving Europe you have a customs agent stamp the Shopping Cheque as if it were a government-issued tax-refund form. Then you claim your refund at the ETS refund window, which is located near customs booths in most major airports. In some countries ETS makes cash refunds in the local currency. But if you prefer, the refund can be made in U.S. dollars via either a charge-card credit or a check. In each case, the company deducts a handling fee equal to 20 percent of the VAT amount. Europe Tax-Free Shopping says it has more than 90,000 participating retailers in 19 European countries - all the members of the European Union plus Norway, Switzerland, Hungary and Slovenia.