Duty-Free Sales

Duty-free sales take place within the context of international travel. International travel is a prerequisite for purchasing duty-free goods. Products available through duty-free shops are exempt from customs duties as well as excise, sales, and value-added taxes. International travelers have access to a special tax privilege. With the growth of air travel, airport duty-free purchasing has become a significant part of the overall duty-free sector. Duty-free sales also take place on board international flights and cruise ships; there are even entire tourist destinations such as Sint Maarten in the Caribbean where duty-free retailing is widespread. Even though duty-free purchases may be free of certain taxes imposed by the host country, travelers who exceed their own country’s duty-free allowance will be subjected to taxes when they ...