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VAT Questions

San Diego...
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VAT Questions

I usually fly in and out from CDG and have no problems in getting stamps for detax etc. The first time, I made the mistake of checking in my luggage before heading to the office for the stamps, thinking that I would have less luggage to carry out and that it would be easier. The officer told me that I would need to show them the merchandise before they would stamp the paper. Anyway, he let me by that time.

I have learned since then. A different sort of problem arose on my last trip from HAM to LAX with a layover at CDG. I went to the detax office for the stamp at HAM airport and happily showed them the merchandise, some of which I was wearing. The officer told me that, since I did not have the merchandise packed in my luggage, I would have to do the detax stamp at CDG. This piece of information seemed to contradict what I had been told at CDG in previous trips. That is, if the merchandise is packed in luggage that is already checked in, so that it would not be possible to show the merchandise, they would stamp the paperwork for me at HAM but not at CDG. That seems to be a bit of contradiction, or is it?

The layover at CDG was really tight and I did not have time to do the detax. I was told that I can get the stamp at the French Embassy. Has anyone else encountered this sort of problem? Did you go to the French Embassy for the stamp, and where is it anyway? If this happened to you, please let me know how you went about getting it resolved?

One more detax question. It seems to me that you would get different percentage of tax back at different stores. Some give you 16%, but I rarely got those while others give only about 5% back. The usual is 10%. I have no idea about the variability. Does anyone have any idea who or what determines the percent of tax you would get back? It seems arbitrary to me.

Thanks very much in advance and Happy Holidays!

Groves, Texas
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1. Re: VAT Questions

part od your problem may have been that you were wearing your purchases. You are not supposed to be using your purchases. We left ours in a Chanel shopping bag so we could show the man at the VAT office. We then went and checked in our luggage. However, my Chanel purse came on the plane with me. As far as I know the merchandise does not need to be packed in your luggage you just can't be wearing it or using it. I don't know percentages of what you will get back in terms of refund. I got back around 200 dollars on my charge card. However, we spent alot at Chanel.

Paris, France
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2. Re: VAT Questions

<<<This piece of information seemed to contradict what I had been told at CDG in previous trips.>>>

The detax stamp is issued for merchandise purchased by non EEC citizens just before the merchandise leaves an EEC country. The HAM inspector was allowing your checked items to be stamped under the assumption that you would not have access to them again in an EEC country. He should have asked to see them none the less. The HAM inspector could not confirm that the items on your person would ultimately leave an EEC country, hence no stamp. In theory they could be left with someone in Paris.

<<<It seems to me that you would get different percentage of tax back at different stores.>>>

The percentage of tax back is approximately 20% (others may remember the exact tax amount). The difference between what you receive and the actual tax amount is kept by the vendor. This is why the refunds to customers differ and the reason why many vendors are so eager to see that you apply for the refund.

<<<You are not supposed to be using your purchases.>>>

This may be true but I have never seen this requirement written anywhere. The objective is that items purchased detaxed actually leave the EEC.

Groves, Texas
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3. Re: VAT Questions

I think I read that you were not to be wearing them or using them in a Paris guide book. Whatever the rule is we had ours out to show and we received our stamp and our refund.

Paris, France
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4. Re: VAT Questions

Sarastro, the difference between the refund the customer receives and the actual tax amount is not kept by the vendor.

VAT (Value Added Tax) in France is 19.6%. This is included in the price when you purchase something.

Stores have arrangements with detaxe companies who do the paperwork regarding VAT refunds for non-EEC residents. The amount the customer gets back is less than 19.6% because the detaxe companies take a percentage for this service. The amount the customer gets back varies according to which detaxe company the store uses.

In my shop, the customer gets back 13% of the amount spent. I receive the same amount for an item whether it is purchased by a Parisien or a customer who will get the tax refund.

Paris, France
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5. Re: VAT Questions

Would just like to add that the 19.6% VAT is a sales tax that vendors have to pay to the government (monthly or every 3 months). The French government would not allow vendors to keep a percentage of it!

However, vendors may in fact encourage customers to apply for the refund because in order to do so, you must spend over 175 euros in the shop.

Eindhoven...
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6. Re: VAT Questions

It might also be good to add that there are several VAT rates. In France a lot of goods fall under the 19.6% rate, but there is also a 5.5% rate (and even 2.1%). In those cases, "detax" probably isn't worth the trouble.

Don't ask when you pay 19.6%, and when 5.5% - this is really complicated stuff. Apparently, chocolate bonbons for example fall under the 19.6% rate, while chocolate bars have a 5.5% rate. I think originally "luxury" goods were supposed to fall under the 19.6 rate, and "basic" goods under the 5.5 rate. However, I understand that nowadays you pay 5.5% VAT on truffles (the fungi) or foie gras - so it can be confusing...

San Diego...
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7. Re: VAT Questions

Thanks to all who replied. Per Rick Steven's (?) guide, one should not wear the merchandise. However, I went to the French embassy website, there was no mention of not wearing the merchandise.

I thought the idea of detax is for one's personal use. I do not see why one should not be able wear/use the merchandise as long as the merchandise moves out of the EU. I am sure they (the gov) can come up with million of reasons why that is. I purchased a cashmere coat because it was so cold in Europe. Otherwise, I really have no use of it when I am in San Diego.

As for the different percent of VAT refund, still have no clue. It is what it is.

Paris, France
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for Paris, Loire Valley
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8. Re: VAT Questions

<<<Sarastro, the difference between the refund the customer receives and the actual tax amount is not kept by the vendor.>>>

<<<Stores have arrangements with detaxe companies who do the paperwork regarding VAT refunds for non-EEC residents.>>>

I wanted to take some time to confirm my information before responding to tumbleweedparis' comments.

While small shop owners may or may not utilize the service of "detax companies", larger retailers such as Le Printemps, Galleries Lafayette, and others either do not use companies of this type and process detax forms "in house" or they receive substantial volume discounts from outside processing firms.

I thereby standby my original assertion that the detax process is indeed a formidable profit center for many retailers. The detax percentage returned to the customer is determined by the retailer (exclusive of handling costs) subject to the 19.6% original withholding amount.

USA
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9. Re: VAT Questions

>>>One more detax question. It seems to me that you would get different percentage of tax back at different stores. Some give you 16%, but I rarely got those while others give only about 5% back. The usual is 10%. I have no idea about the variability. Does anyone have any idea who or what determines the percent of tax you would get back? It seems arbitrary to me.<<<

IF you apply for 'de Taxe' sale at an individual store, at the time of purchase, your VAT (19.6% on most consumer goods) refund claim will usually be processed through a third-party, VAT Refund agency. The rates of refund will vary (it's not a surprise that the rate seems arbitrary) according to the formula the agency applies. As an example, the deTaxe service offered by grand magazins like GALERIES LAFAYETTE and PRINTEMP usually provide an immediate, on-premises 12% refund. So....VAT de Taxe mileage may vary depending on the store.

10. Re: VAT Questions

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