"Duty Free" Doesn't Always Make the Best Buy

Filed in archive Tips and Tricks on November 9, 2008

The facts are simple, really: "duty free" is a term that means you don't pay certain taxes on an item. That's good, right?

The problem is that most duty free stores are inside malls and airports where their rent is fairly high. Often that means that their prices are fairly high - even if you don't pay taxes on the item.

The only way to know for sure how good a deal is at a duty free story is to shop around. That means you should look at duty free items on your way into a country but not buy duty free items until you're ready to leave. It also means you have to go through the trouble of finding out how much you will pay in taxes on an item when you leave. If a bottle of wine is $8 at the duty free store and $5 at the market arcoss the street from the airport, the duty free wine is a good deal if you're going to have to pay more than $3 in taxes on the wine when you leave. And the duty free wine is a bad deal if you're going to have to pay less than $3 in taxes on the wine when you leave.

The only way to know is to get the information on taxes and then do the math. Often, duty free items are not the best deal...


Photo courtesy of iStockphoto, George Clerk