DUTY FREE: What Does Duty Free Really Mean?

Thank you to everyone who wrote in by email and on the blog for this Friday’s post. From the variety of suggestions offered, there was one that stuck out to me and so today we’ll be talking about the concept of duty-free shopping. If you’ve ever travelled abroad or taken a cruise, you’ve probably seen duty free shops or signage. But what does it mean and should you buy duty-free items?

The government of the country in which you are visiting imposes taxes on what is considered luxury items sold at stores. Certain items incur a “sin tax” such as liquor, tobacco, and cigarettes. Quite often the price you pay also includes an import fee, the price it cost to have the item imported into that country. After taxes and fees, the price can be substantial. However, in a duty free shop, you can definitely save money. Those items you see in the duty free ship are priced to exclude the customs duty and taxes from that country. The more significant savings can be found on liquor and tobacco, but you need to be a savvy shopper as not everything in the store will be a great deal. I wonder if they’ll ever offer duty free savings on Vape Juice and vape pen cartridges in the future.

Additionally, it is your responsibility to understand the limits of how much of any type of product you can bring back home. If someone on the street or on your ship tells you something and it’s not true, you’re still responsible when you arrive back home.

Travelers are allowed to bring up to $800 worth of merchandise back into the United States without paying duty although there are many exceptions to this and you should check the U.S. Customs and Border Protection web site for specifics. One standard rule is that only one liter (33.8 ounces) of alcohol and 200 cigarettes or 100 cigars may be included in this exemption. One interesting note is that family members living together in the same household and traveling together can combine personal exemptions. That applies to children and infants who have the same exemptions as adults but for the alcohol and tobacco items. Ultimately, if you bring back more than what your exemption allows, you’ll end up paying duties on those items. Also, for the item of alcohol allowed back into the country, it doesn’t matter if it was purchased from a duty free shop or not.

What happens if you have to pay duty? Upon entry into the United States and once it is determined how much you owe, you will be required to pay duty. You may pay in U.S. currency, money order, traveler’s check, personal check drawn on a U.S. bank, and some locations do accept credit cards.

Enjoy your trip and if you want to bring back suitcases full of alcohol and cigars, realize that it will cost you. You should also know that by law, U.S. Customs officers have the authority to conduct enforcement examinations without a warrant. This ranges from searching one of your bags up to and including a personal search of you specifically. For what it’s worth, import duties are generally charged only if you’re carrying in large or commercial quantities of items. The average vacationer never has to worry about this, but you should be aware and knowledgeable of what to expect.

Go have fun on your next land vacation or cruise, but don’t forget about U.S. Customs and Border Protection. There’s this handy little booklet that you can download and review if you don’t want to scour their website for information. It makes for a quick read and will prepare you for what to expect, especially if you’ve never traveled outside of the country.

There are different exceptions and limitations within the Duty Free program, including a $1600 exemption if you travel to the U.S. Virgin Islands, American Samoa, or Guam. If you’re buying $1600 worth of liquor there, you better call me and tell me where the party is! In St. Maarten, loose gemstones are exempt from customs duties. Ladies: That means you can spend as much as you like on say a loose diamond and you don’t have to pay a cent on duty! I like that!

Well that was a great way to start our Friday blog where you get to tell me what to write about. I’d like to keep this going and do it every Friday so please, continue sending in your requests and I’ll keep writing! Enjoy your weekend and a very happy Father’s Day to all of the fathers out there. This drink is for you!

Do you love shopping while on a cruise? Read some of my latest cruise reviews here on the website.