Educate me on VAT

[klfrodo]

From the US.

Going to the Med next.

Spending a couple of days in London.

Then flying to Venice, will spend a couple of days in Venice pre-cruise, then board the ship and sail around around Greece, a couple of days in Istanbul, then return to Venice and depart the ship to fly back to the US.

 

So my questions are about VAT.

I saw on some daily papers for the cruise that the ship will charge a 22% VAT on all purchases and that you MAY be able to get that back with proper paperwork.

Also read somewhere that hotels MAY reduce your final bill by removing VAT.

 

So, what has your experience been?

Did the hotel remove the VAT for you?

Is it difficult to receive the VAT back?

General information that you feel would be important to know would be appreciated.

 

(Side Note: Please don't share this potential revenue stream with our government officials. :) )

[John Bull]

I'm no expert but a couple of little pointers:

 

You can only reclaim VAT on things you take out of the EU.

So you can reclaim it on souvenirs but not on drinks, snacks, meals etc that you buy on the ship or ashore.

By the same token, you can't reclaim VAT on hotel bills unless it's a business trip.

 

There's a minimum purchase, which can be the total of several items bought from the same place at the same time & on the same receipt. You'll need your passport at the time of purchase

 

Checking the web on a particular point I've just come across

https://www.ricksteves.com/travel-tips/money/vat-refunds

which knows a lot more than I do.

 

I think you have to buy from an outlet which operates a VAT reclaim system, so you're unlikely to get it via a non-touristy shop.

You're also unlikely to get a refund on second-hand goods, such as antiques

This is a useful consolidation website

http://www.globalblue.com/

Some can deduct the tax on the spot, others will give you a reclaim form which you present at your last exit point from the country - or in the case of an EU country your last exit point from the EU, which in your case is Greece - along with the goods (so if that's an airport either pack them in your hand luggage or present them before you check-in). NB Altho the UK isn't a Eurozone country it is an EU country, so you can't reclaim VAT at your London airport since you'll have an airline ticket to another EU country. So you reclaim for UK purchases at Athens airport when you fly home - you'll lose a little on exchange rates.

There are desks at major airports for this sort of thing but I have my doubts about Istanbul port. And I don't even know if there's VAT, let alone a refund system, in Turkey.

 

For major purchases in ship's shops, if tax is payable I have no doubt that the ship operates a refund system.

 

It can take months for a refund to arrive.

 

So in a nutshell it's only possible - and worthwhile - if you make an expensive purchase of something to take back home with you.

 

JB :)

Edited August 12, 2015 by John Bull

[Canuker]

VAT stands for Value Added Tax. It is a tax on consumption, ultimately born by the final consumer of a product or service. As a consumer, think of it as a sales tax.

 

VAT is not chargeable on exports (technically it is charged a zero percent, but that's not relevant here). You, as a foreign consumer, are technically buying what is an export from the country you are in. So no VAT is applicable.

 

But you will invariably pay it up front when you buy (there are exceptions in high-tourist areas/industries, as you have suggested) and you must claim it back, WHEN YOU LEAVE THE COUNTRY.

 

How to claim? I can't speak to other countries, but this webpage explains the UK 's process quite well. https://www.gov.uk/tax-on-shopping/taxfree-shopping Be sure to take your passport with you when you shop and keep all receipts, to show the customs officials as you exit that country. You will be paid in the currency of that country.

 

VAT rates in Europe (Canada also has a VAT system) can range as high as 33%. So the potential for savings can be significant. It is common in Europe for receipts to not show, separately, the VAT component. So just because no tax is shown, do not assume that no tax has been charged.

Also, the prices of goods and services on display are usually VAT-inclusive. So the price you see is the cost you pay, unlike in the US, where tax(es) are additional.

 

Hope this helps.

Edited August 12, 2015 by Canuker

[klfrodo]

Very informative.

Thank you

[John Bull]

It is common in Europe for receipts to not show, separately, the VAT component. So just because no tax is shown, do not assume that no tax has been charged.

 

Hope this helps.

 

True.

On this point, if VAT hasn't automatically been split out on the till roll, it's important to ask for a "VAT receipt" - this will split out the VAT, and quote the vendor's VAT registration number. Some goods are subject to VAT & some (eg in the UK children's clothes) are not.

 

JB :)

[SteveH2508]

JB

 

Turkey is not in the EU so no VAT - this will also mean no VAT on the on board purchases because the itinerary leaves the EU.

[conte]

I'm taking a TA from Rome to USA this fall, after spending a few weeks touring Italy. Does anyone know if there is a VAT reclamation office at the port. Thanks.

[happy trailer]

JB

 

Turkey is not in the EU so no VAT - this will also mean no VAT on the on board purchases because the itinerary leaves the EU.

 

It's not only EU countries that charge VAT. I believe current VAT in Turkey is 18% on purchases (likely refundable), and 8% on hotel stays (usually included in your nightly rate, and not refundable).

[SteveH2508]

It's not only EU countries that charge VAT. I believe current VAT in Turkey is 18% on purchases (likely refundable), and 8% on hotel stays (usually included in your nightly rate, and not refundable).

 

Apologies - that's me being a bit Euro-centric. (I can't believe I just wrote that!:eek::D:o:()

[navybankerteacher]

I'm taking a TA from Rome to USA this fall, after spending a few weeks touring Italy. Does anyone know if there is a VAT reclamation office at the port. Thanks.

 

I've sailed from Civita Vecchia several times and never saw reclamation office. In any event, the process is so absurdly difficult at the airport that it is not worth considering unless you have made a really major purchase. At the time you make the purchase you must show your passport and specifically request, and receive, the proper receipts. I believe that you must have spent over 150 euro at any particular vendor for the expenditure to be subject to reclaim - not an aggregate of 150 from several shops.

 

You must be prepared to spend a couple of hours in the process because of the necessity of showing the goods and the receipts -- to civil service employees who will seem profoundly dis-interested in helping you cope with the process.

 

If the VAT is, say, 20% and you have a $500 item, or eligible items aggregating $500, you are talking about a $100 claim - worth your time and frustration perhaps - but certainly not worth the effort if you are talking about much less.

[VMax1700]

If your cruise is going to Istanbul or terminates in Istanbul, or if you call to a non EU port (eg. Tunis, Montenegro) during your cruise then vat will not apply - except when in port (eg overnight in Venice).

 

When on land (eg in London or Venice) the price shown on the sticker of the item iincludes vat, so there is no extra tax to be paid. In some restaurants there may be a 'service charge' or indeed a 'cover charge' but vat is included in prices and will not be charged extra.

[happy trailer]

Apologies - that's me being a bit Euro-centric. (I can't believe I just wrote that!:eek::D:o:()

 

Phew! I was wondering! :)

[SadieN]

I've sailed from Civita Vecchia several times and never saw reclamation office. In any event, the process is so absurdly difficult at the airport that it is not worth considering unless you have made a really major purchase. At the time you make the purchase you must show your passport and specifically request, and receive, the proper receipts. I believe that you must have spent over 150 euro at any particular vendor for the expenditure to be subject to reclaim - not an aggregate of 150 from several shops.

 

 

 

You must be prepared to spend a couple of hours in the process because of the necessity of showing the goods and the receipts -- to civil service employees who will seem profoundly dis-interested in helping you cope with the process.

 

 

 

If the VAT is, say, 20% and you have a $500 item, or eligible items aggregating $500, you are talking about a $100 claim - worth your time and frustration perhaps - but certainly not worth the effort if you are talking about much less.

 

 

In Rome a few years ago, there were several addresses where we could turn in the paperwork. We went to an office somewhere in the historic center. It was very easy to do. Hardest part was finding the building.