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Collecting tax refund can be hassle, tourists in Europe find

Delays, paperwork and go-betweens complicate process

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"How in the world are you supposed to get the tax refund on things you buy in Europe when the airport is so jammed?" asked a frustrated tourist who recently discovered the two hours she'd allowed to check in at Ireland's Shannon International didn't leave time to stand in one more line.

Most American shoppers abroad aren't even aware they're paying the national sales tax European countries call value-added tax — which ranges from 4.8 percent of the purchase price of most products in Slovenia and Croatia, to 20 percent in Sweden, Denmark and Hungary. Since it's not meant to be an export tax, nonresident travelers don't have to pay it on items such as clothing and gifts they buy in Europe to take home. But because it's built into the price of goods, not added at the time of purchase, you have to request a refund.

Since the reclamation process can be complicated — among other things, all countries except Ireland require a minimum purchase per store, ranging from $23 in Sweden to $305 in Switzerland and Lichtenstein — American tourists last year left behind an estimated $50 million in unclaimed tax refunds. (Leisure travelers can't get a tax refund on meals, lodging, rental cars or products used abroad.)

For small spenders, the routine isn't worth the trouble. You have to carry your passport when you go shopping to document that you're a tourist, get a form from each store, have it stamped by a customs official in that country (if it's not a member of the European Union) or at your final departure point from the Union.

Some shops will run off two credit card slips, one for the price of the purchase minus the VAT, one for the tax alone; if you get the required customs validation on your purchases so the store can prove to the government that you left the country with them, it'll process only one slip and you won't have to pay the tax. In cases where you're due a refund, you mail the validated forms back to each store or turn them over to any of several companies with airport booths that handle the process for a percentage of your refund. These go-betweens offer the refund via mail, charge-card credit or in the case of one called Global Refunds, immediate cash.

To use Connecticut-based Global's services, you must shop in affiliated stores — more than 110,000 in Europe display its "Tax-Free Shopping" logo — and ask the clerk for a Global Refund Cheque. The hitch is it still must be stamped by a European customs agent (who can demand to inspect the goods). In crowded, understaffed airports filled with other befuddled tourists, this is the big sticking point. However, once you have the stamp, if there isn't time to cash the "cheques" at a Global booth in the airport departure area, you can do it at any of 600 other Global cash-refund locations worldwide. For the service, Global takes anywhere from "a few percent" up to 20 percent of the refund, depending on the amount of purchases and the country. For more information, call 800-KNOW-VAT.

Web sites: www.customs.treas.gov; www.globalrefund.com