How travelers can get money back

Travelers to Europe may be leaving money on the table when purchasing products there.

I learned this during a recent trip to Italy. My girlfriend, who bought a pair of shoes in Venice, was able to request a refund. value added tax paid for the purchase.

Ultimately, he got back 17 euros ($20) of a total purchase of 155 euros ($181).

Rebates for the value-added tax, known as VAT, could be worth “some money” for U.S. travelers to Europe, depending on what they buy and in which country they buy it, said Sofia Markovich, a travel consultant and founder of Sofia’s Travel.

Getting a few extra dollars back after a European vacation might go some way to helping offset the high airfare costs caused by the Iran war. euro-US dollar exchange rate this has become less favorable in recent years.

But we would have missed it if the Italian shopkeeper hadn’t then asked us if we wanted the necessary paperwork to claim the refund; we did this with relative ease at an airport kiosk in Rome.

Experts said that often stores do not mark this option for customers.

“You must remember to take [the paperwork] because not every store will remind you of that,” Markovich said. “You personally need to be proactive about it.”

For some, the added hassle that often involves an extra stop at the airport may not be worth it for lower-value items, NerdWallet travel expert Sally French said.

“It’s a nice thing to have, but I’m not going to the airport early to save $10,” he said.

Value-added taxes are a tax on domestic consumption, such as retail sales taxes levied by U.S. state and local governments.

VATs It is the most widely used type of consumption tax in the world. more than 170 countries worldwide.

European countries apply various VAT rates, which may vary depending on the product.

Standard VAT rates range According to the Tax Foundation, in Switzerland it is 8.1% and in Hungary it is 27%.

For example, in Spain the standard VAT rate is 21% but lower rate For certain items, such as 10% for sunglasses and 4% for books and magazines, according to Global Blue, a payments company that helps facilitate VAT refunds.

But not all purchases are eligible for a refund, experts said.

Experts said refunds generally apply only to merchandise and not certain categories such as hotels and dining.

Many countries impose a minimum value on purchases to be eligible.

“Typically, you have to look for the minimum at a single retailer; you can’t add up purchases from several stores to arrive at the required amount, so if you’re doing a lot of shopping, you’ll benefit from finding a spot where you can buy in bulk,” says travel expert Rick Steves, who has written a number of guidebooks. wrote In an article about VAT refunds.

For example, countries like Greece and the Netherlands require travelers to spend at least 50 euros ($58) at a retailer before they can claim a refund. Rick Steves’ Europea travel and tour company. In Italy the minimum is 75 Euros ($88); France’s is 100 Euros (US$117). The minimum in Switzerland is 300 Swiss francs (US$384). On the other hand, there is no minimum in Spain.

For travelers who purchase luxury goods such as high-end fashion or jewelry, the refund is “definitely worth it,” Markovich claimed.

“It could be hundreds, even thousands of dollars, depending on what you buy,” Markovich said. “I know people who go to Europe just to shop.”

Steves also wrote that travelers should not use their belongings before leaving Europe.

“If you go to customs wearing your New Netherlands clogs, the authorities may refuse to refund you,” he wrote.

Experts said claiming a VAT refund is usually a multi-step process.

Steves wrote that participating vendors are usually required to fill out a refund document, and will need the traveler’s passport (or sometimes a photo of the passport) to do so.

In most cases, travelers will need to process these documents at their final stop in Europe, most likely at the airport, Steves wrote.

“At some airports you will need to go to a customs office to get your documents stamped and then go to a separate VAT refund service such as Global Blue or Planet to process the refund,” Steves wrote. “In other airports, a single VAT desk handles everything.”

Steves wrote that refund services typically charge around 4 percent, so travelers probably won’t get the full VAT.

Travelers should remember to process documents at their final stop in the European Union, Steves said.

“So if you buy sweaters from Denmark, trousers from France and shoes from Italy and you’re flying home from Greece, have your documents stamped at the airport in Athens,” he wrote, adding: “And remember: Switzerland, Norway and Turkey are not in the EU, so if you shop in one of these countries, have your documents stamped before crossing the border.”

He wrote that customs offices are sometimes located in front of airport security and that agents may ask to see passengers’ unused belongings.

The whole process was simple for us: It took about five minutes from start to finish at the digital kiosk we arrived at just before the security checkpoint at the airport in Rome. Others who want to claim a refund should take more time, experts said.

In some countries, “there is a line, and when you go to the airport you have to allow extra time to wait in that line,” NerdWallet’s French said.

“I question whether it’s worth spending time at the airport,” he said. “This makes sense if you’re buying a $5,000 designer bag. But time is money, and it’s okay to skip saving a few dollars here and there for time and work.”