When traveling, we all have crossed duty-free stores upon duty stores at the airport, and if you recall some instance in your life, you might probably remember someone telling you that these stores help save you a lot of money on the purchase too. However, if you have never had the opportunity to go inside a duty-free shop, then we are sure you might have a hard time believing this concept.

We understand this because why would a shop at the airport sell something for cheap? If the thought doesn't sit well with you and you want to know more about these duty-free stores, how they work, and much more, then you have landed on the right page. Hop on below to read all you should know about duty-free shops.

What is Duty Free?

Duty-free refers to the ability to buy an item in circumstances where you don't have to pay any additional import, sales, value-added, or other taxes on it. These stores are one of the best perks of international travel as many retail businesses inside the airport sell their merchandise with prices exempted from duties and taxes with the understanding that they will be taken out of their country for use.

A few popular duty-free items many people purchase from the airport are chocolates and perfumes. Now that you understand what a duty-free shop is, we are sure you must be thinking about where you can find these shops to make a purchase, right? While you may have heard about these shops being at the airports, that not the only place you can find it. We have more on this covered in the heading below.

Where are the Duty Free Shops?

While most of us know that duty-free shops are present in the international airports of every country, did you know that this is not the only place where you can find such shops? Yes! You heard us right.

Apart from the airports, most duty-free shops are also located at the seaports on ships and even on airplanes. This is because retailers understand that many people are usually likely to purchase stuff when they immediately arrive in a country or when they are leaving it. Hence, with this understanding in mind and to capitalize on the visitor's tendency to make a purchase, many duty-free shops are placed in high-traffic areas for better convenience. You may find a few duty-free shops at the shopping malls, along the beach, or some famous tourist areas in the country. The location usually depends on the country which you are visiting.

How Does Duty-Free Work?

When you make a purchase from any retailer in a new country, the host country expects you to pay import, sales, VAT, or some local taxes on the goods you buy. However, apart from these ordinary circumstances, there comes a particular situation or concept called duty-free.

When shopping at international airports, sea terminals, layovers, or onboard cruise ships, your purchase is considered in a no-man's land. This means that you are neither inside any country nor outside of it, irrespective of standing at the airport terminal of one. This no-man-land status basically justifies the provision of a security shield for passengers in transit from the host country's taxes.

Hence, whatever item you purchase from that country's airport or any duty-free shop will be much cheaper than what it would have cost you in the shop of the said country. Duty-free shops often sell premium branded high-markup goods like luxury or also sell some upscale tourist items from the host country for the passengers to take home with them.

What are Some of the Most Important Rules of Duty-Free?

While duty-free might sound like a dream to many, and you might imagine purchasing a truckload of merchandise and shopping to bring home with you, we like to pop your bubble here. Duty-free comes with some important rules that have to be considered while shopping. In between your dreams of bringing home a truckload of content, it is essential that you do not neglect these rules.

The first important rule when duty-free shopping as a US citizen, which you should follow, is that when you return home after staying in a foreign country for at least 48 hours, you are only typically allowed to bring $800 of duty-free merchandise. This means you have a $800 limit threshold, and a a dollar above it might cause steep surcharges.

In case you exceed your limit, you will then have to pay a 3% surcharge on the next $1000 worth of purchases you will make. In the case of those with over $1800 of purchased merchandise, they are bound to pay a tax of up to 25% on the overall amount that exceeds this limit.

Other Essential Key Rules Which Should Be Considered Are:

• Americans who visit a foreign country for less than 48 hours only get a $200 exemption.
• Family members can combine their exemptions, which means all members can use their exemptions to purchase a worth of duty-free goods to take back home.
• Smoking and drinking items do not come under a child's exemption and, hence, should only be bought by an adult.

Wrapping Up!

Duty free stores are a great place to purchase incredible items in foreigh countries at much cheaper rates. If you are someone who heard about duty free stores but didn't know what it was, then we hope this article was helpful for you. Let us know whether you shopped at a duty-free shop and if you found any difference in the pricing of the item you purchased from its original price.