Duty-free shop

A duty-free shop or store is a retail outlet whose goods are exempt from the payment of certain local or national taxes and duties, on the requirement that the goods will be sold to travelers who will take them out of the country, who will then pay duties and taxes in their destination country (depending on its personal exemption limits and tariff regime).

[4][5] Brendan O'Regan established the world's first duty-free shop at Shannon Airport in Ireland in 1947;[6] it remains in operation today.

Designed to provide a service for trans-Atlantic airline passengers typically travelling between Europe and North America whose flights stopped for refuelling on outbound and inbound legs of their journeys, it was an immediate success and has been copied worldwide.

Thirteen years later, two American entrepreneurs, Charles Feeney and Robert Warren Miller, founded what is now Duty Free Shoppers (DFS) on 7 November 1960.

Securing the exclusive concession for duty-free sales in Hawaii in the early–1960s was a commercial breakthrough for DFS, which enabled the company to focus on Japanese travelers.

In 1996 LVMH Moët Hennessy Louis Vuitton acquired the interests of Feeney and two other shareholders and as of 2012[update] jointly owned DFS with Miller.

Generally, goods are free of duty and tax levied on imports for sale anywhere in the shopping destination.

This allows reduced taxes on wine, Champagne or Prosecco, beer and spirits as well as on cigarettes, cigarillos, cigars, or tobacco.

In Thailand, the King Power chain has shops where duty-free items are pre-purchased and delivered separately to the airport to be picked up on departure.

[20] In order to gain entry, a passport is needed to be presented and registered at the Customer Registration Counter at the entrance of the mall.

Arriving customers are given a certain tax-free allowance on purchases and anything in excess will be subject to local and national taxes.

This does not apply to passengers transferring within the EU and Singapore on the same day, as long as the liquid item is sealed in a plastic security bag that shows the receipt.

[needs update] This method of retail removes any security problems with the transit of liquids, as they are not carried on aircraft.

Other objects that have sharp parts, such as model airplanes, may be bought in-flight but received at the passengers' home address for the same reason.

Proof of travel may be requested at the checkout point to prevent airport employees from making personal purchases.

Some countries or districts, including Argentina, Australia, Brazil, Chile, China, Colombia, Iceland, Italy, Iran, India, Jamaica, Kenya, Lebanon, Malaysia, New Zealand, Norway, Panama, Philippines, Sri Lanka, Switzerland, Taiwan, Turkey, United Arab Emirates and Uzbekistan have inwards duty-free facilities, where arriving passengers can purchase duty-free items immediately before going through customs.

The European Union does not permit arrivals duty-free stores; some EU airports sell goods on arrival in the baggage claim area described as "Tax-Free", but these goods are all tax-paid sales, the local sales tax is discounted.

In some countries, in order to ensure that goods are exported intact, they are hand-delivered in a closed bag to the passenger at the gate after their ticket is scanned.

U.S. citizens receive substantially higher duty exemptions than normal when they visit or transit these locales, e.g., Guam, U.S. Virgin Islands.