Why would a Country give tax back ?

[AdamEfimoff]

I heard Kevin say that you can get VAT back as a tourist?
This is true ! Not disputing that

But always thought you want to generate money from foreigners. That helps your GDP among others .
So I know Europe and Australia does this! But why what benefits does the country get for doing this?

ps. I know VAT is Euope only. In Australia I mean GST

 

[carpenta]

In the E.U. the VAT tax is the main way the countries raise the funds to run their countries. They have small income taxes and property taxes. In Monte Carlo for instance there is no tax on it's citizens. It is a kingdom and ruled as such. I guess since visitors are not citizens they don't want to have them pay as subjects. The VAT is "built in" to the final price and when you pay for an item the price you pay is the final price unlike the U.S, where the tax is added onto the item at the end of the sale. 16 to 18% is a hefty price IMO so I am glad to get it back. Tourism is big business in Europe and I would suspect the Europeans don't want to kill the golden goose.

P.S. Pray for the people of Brussels this morning.

 

[anonymousegirl]

of course you can't get it back for small purchases. Typically you need to buy a large amount, like 300 euros, either in one transaction, or in multiple from the same shop (like a department store). If you know how much something is costing here in America, including state sales tax, then figure out the price there and minus the VAT, you can get some good deals. I bought a fancy purse in Paris and saved over $200. One bag that I didn't buy was a saving of $600.

 

[cjbcam]

Canadians can get taxes back from some states they shop in. All you have to do is pick up a form at the border fill it out and send in your receipts with it.

 

[BadPinkTink]

of course you can't get it back for small purchases.

Not correct. You can get the tax back on any amount of purchase. Some USA States give tax back to oversees tourists, some do not. Louisiana gives tax back, California does not.

You can get tax back on any purchase except food. It is usually done at the airport but some shopping malls have a tax back counter. You keep all your receipts and fill in the form. The receipts were from different stores in the mall. When you buy something you have to request the tax back form from the store. When I did it at the mall in New Orleans, I got the money back there and then. I didnt HAVE to do it before I left the mall, but as I was leaving the state the next day, I knew I would not be doing much more shopping around the city.

Its the same process when you are in Europe. Many stores here in my city have a sign up telling tourists about the tax back scheme. Whenever you buy something you need to request the tax back form. Then at the airport near the departure gates, you just go to the tax back counter with your receipts and the forms from the store and you can get your tax back.

 

[Cinderella's Slipper 2015]

The wording is tricky. You think that it has to be over $75 to get the VAT tax back but in actuality, if you are returning to a Non-EU country, you can get the VAT tax back on all purchases, regardless of amount.

 

[rcchello]

The reason some countries refund the taxes on purchases that leave the country is to try to increase the amount tourists buy. The thought is it will bring more money into the local economy.

 

[sayhello]

Just beware. I bought a large ticket item at Harrods in London, and they told me "Oh! Keep all your receipts from today, and take them downstairs, and our offices will refund the VAT for you! It's a service Harrods offers!" Sounded great. So I went downstairs, stood in line, and was eventually served. They filled out all the paperwork, but it was only *AFTER* they had stamped "VAT REFUNDED" all over my receipts that I saw the totals, and found out that they were keeping 33% of my refund as a fee!!! There were no signs saying this, nowhere besides the final receipt that indicated there was any sort of fee for this "service" at all!!! At that point, I really didn't have the time, patience or energy to argue with them about it, get all new receipts, etc, so I just yelled a bit, took my money and left. But beware of *any* place offering to do you a "favor" and get the refunds for you!

Sayhello

 

[lost*in*cyberspace]

Just beware. I bought a large ticket item at Harrods in London, and they told me "Oh! Keep all your receipts from today, and take them downstairs, and our offices will refund the VAT for you! It's a service Harrods offers!" Sounded great. So I went downstairs, stood in line, and was eventually served. They filled out all the paperwork, but it was only *AFTER* they had stamped "VAT REFUNDED" all over my receipts that I saw the totals, and found out that they were keeping 33% of my refund as a fee!!! There were no signs saying this, nowhere besides the final receipt that indicated there was any sort of fee for this "service" at all!!! At that point, I really didn't have the time, patience or energy to argue with them about it, get all new receipts, etc, so I just yelled a bit, took my money and left. But beware of *any* place offering to do you a "favor" and get the refunds for you!

Sayhello

Nothing new; taking a service fee happens even from VAT refunds at the airport. You never get all of it back.

 

[RZphilly]

Nothing new; taking a service fee happens even from VAT refunds at the airport. You never get all of it back.

You don't pay a service fee at the airport for Vat refunds in Ireland or any country I have ever visited ? You receive the full amount of VAT paid in full .

 

[RZphilly]

I heard Kevin say that you can get VAT back as a tourist?
This is true ! Not disputing that

But always thought you want to generate money from foreigners. That helps your GDP among others .
So I know Europe and Australia does this! But why what benefits does the country get for doing this?

ps. I know VAT is Euope only. In Australia I mean GST[/QUOTE
The reason you get the VAT back is to make prices competitive for tourists . It also helps the local economy . Also the shop you buy the said item from still has to pay tax on the profit of the item anyway . You can also avail of tax off purchases in some states in the USA as well . NY , PA , Fl if you have a foreign passport and prove your taking the product out of the USA you can avail of this as well .