Relax everyone, just a funny expression to start the day. Now that I hopefully have your undivided attention, I’m going to scratch the surface at what this VAT is all about. VAT stands for value-added tax that does not exist in the US, but in more than 160 countries worldwide. Some of you may have come across conversations, articles, etc. on Pinterest and Instagram or maybe you’re a consumer affected by VAT. When buying goods in another country (that impose such tax), we the consumers are allowed a refund on those goods. As you can see in the featured image above, it displays the European rates for 2023, with the darker colors representing the higher percentages.
The amount of VAT will vary for each country, there is not a standard rate. Each country can also have a minimum amount of purchase for visitors to receive a refund. My family and I were in Italy last year and I had to spend 175 euros in order to be eligible for this rebate. Spain for example, requires no minimum amount. It is worth mentioning, that if there is a minimum amount (ie: 175 euros), this needs to be at one merchant. It is not cumulative among several stores.
Here are some things to know for eligibility. One should be a resident of the country and must be leaving within 3 months of their purchase and visit. The seller will ask for your passport (also verifying the fact that you do not reside in the country). So, if you think it will be one of those days while on vacation that you’ll be doing some retail therapy, it is a good idea to have your passport on your person. Not that this has to do with VAT, but this is also helpful when having to exchange currency. They often ask for your passport as well. It is worth investigating ahead of time to know if the country you’re visiting has a cap on what you can spend/get refunded. Lodging, meals and car rentals are excluded from VAT. Global Blue and Planet are third-party agencies that some vendors may use, so don’t be surprised if you notice this on your receipts.
The images above show you an example of what your receipts might look like and the information required. The orange icon is where customs will need to stamp for approval so you receive your refund. The image to the left is my receipt from one of the most spectacular malls in the world, Galleries Lafayette in Paris. It may seem excessive to have the receipts and/or paperwork for all this. Trust me though, this is THE cure to having buyer’s remorse! You will be getting money back (sometimes a significant amount). If you’re anything like me, I like to have something tangible to remember my trips. Yeah sure, I have the wonderful memories, maybe even a full stomach from whatever food I consumed, and photos. But who doesn’t love a work of art like an emerald green and gold purse to have and to hold from this day forward?! I’m pretty sure the French salesman at the Chloe counter is still traumatized that this silly, American girl hugged him with delight when he found exactly what I wanted (true story).
If you’re visiting more than one country and buying items that allow a rebate from VAT, you will have your receipts stamped at the LAST country visited. I know this doesn’t make sense, but it’s true. I bought a purse in Paris but ended my trip in London. Each airport might be different as to where you get your receipts verified. If you’re not sure, please ask someone. For example, at Heathrow in London, I found the VAT counter before I even checked in my luggage. At Fiumicino in Rome, it was after we made our way through security.
Make sure you give yourself enough time to get to the VAT counter to have all your documents verified. You might have to wait in line. Finally, you have 2 options to get your money back. You can choose to have it immediately refunded in cash but they will charge a service fee. Each time I did this, I put down my credit card info to get the refund. I know this seems like complete lunacy. You have to trust me, this is legit and I never had any issues getting the money back or with fraud. I hope this information has given a basic understanding to what VAT is all about. If you need more, there are plenty of articles and even Youtube videos to watch. Please share what trinkets you have acquired along the way! Happy travels and shopping!
