American Beef

Written By bryanboy

One of the things I love about shopping in Europe is that when you spend over a certain amount (it depends on the retailer), you are eligible to get the VAT (Value Added Tax) back when you leave the European Union. All you gotta do is ask one of those tax-free forms, present them to customs to get it stamped at the airport and voila, you either get cash or a credit back to your payment card. Taxes in Europe, as you know, are quite high, especially in Scandinavian countries. But what makes it fascinating is that what you see on the price tags in Europe, similar to the Philippines — at least what at shops, is what you’ll be charged at the counter. No ifs, no buts, no nothing. Unlike in America (India is also the same) where sales taxes are added separately. So depending on the US state where you’re shopping at, that $550 shoe suddenly turns into $7,499.99 in a snap of a finger. Don’t even get me started when eating out at restaurants. There you are, amazed how all the prices are as delicious as what’s being served on the menu but when the bill arrives, factor in sales tax and tip/gratuities, that meal for two is like a meal for ten back home. OK, I’m exaggerating, but still.

Not too long ago, I spoke to a friend who lives in Los Angeles. She, too, hates these pesky sales taxes. She told me that one way to bypass these sales taxes is to buy something from out of state, like New York — and have it shipped home, in California.

Here’s what I don’t understand. And please forgive my ignorance. Why are we, foreign tourists, subject to sales taxation, when we take our purchases out of the country whereas people who live/buy out of state, get their sales tax waived? Also, why doesn’t America have a sales tax refund system in place? Europe has it. Singapore has it — hello, GST?

Just wondering. That’s all.

19 Comments

  1. I think there was a tax refund system in US, wasnt there? They abolished somehow. So its not such fun to shop there anymore :D

  2. Askedn the same question millions of times to every luxury store or department store in the US!

    They all have no idea and gave me weird looks when I told them I wanted a tax refund!

    The California sales tax is different though.
    It’s an additional tax only in the state of California to the normal US national tax!
    And even if you’re a tourist and you buy stuff in California you have to pay it.
    And even if you have stuff shipped from other states in the US to Clafornia, you have to pay it!

    The only way Clarifornia residents could escape it (if they’re lucky), is if they buy stuff from EUropean on-line stores and have it shipped to Clarifornia.
    Many stores in Europe apply the same US tax to all states without adding the additional tax for California.

    Another thing I discovered in the US is that if you buy clothes in some cities(like Boston) you don’t pay taxes if the amount (I think) is under $150!

    I’ll keep checking this post to see if somebody found a solution to this tax refund thing ;-)

  3. yes…agree… and the government should know better… they need our money to govern the government, with gazzillion taxes taxed to the outbound tourist…for sure.. there WILL NOT be any repetition in buying goods!!! Note that ANY GOVERNMENT IN THIS WORLD!!!

  4. I think that US people shouldn’t be complaining too hard about the tax. You get free shipping from just about every e-retailer!

    As far as I can recall (which is over the last 15 years) the only thing the US offered tourists was duty free stores, but basically that was around 10% off RRP or whatever more you could negotiate (if you were lucky). Canada, on the other hand, has so many taxes that they used to offer a tax rebate for purchases over a certain amount but has recently stopped refunds completely – likely because they couldn’t control the smuggling over the border (you had to pay tax on US/other goods coming in) and because online shopping kinda made a mockery of the whole setup.

    Pretty much the only place you’ll find a set of decent duty free shops in the US now is Honolulu airport because they know that you are defo leaving the US, not just the mainland.

  5. You can get a Tax refund, but it’s kind of tricky, you have to go to an agency, and then back to all the stores to get your money back.

  6. in canada you also get the taxes added. It’s ridiculous. I’d prefer everything is added in the tag, and that you know that what you saw is what you payed. When I lived in Canada I remember countless times at the beginning where I had to leave items I wanted because I just had the exact amount of cash and couldn’t pay the added taxes. Also, the process for getting that money back was ridiculous and they made it very hard for you to get your money back if you were there as a tourist. I’ve never been to America, but it’s very shitty if they don’t offer that service to tourists. Tourists don’t live in the country and certainly don’t profit from 90% of the services those taxes are invested.

  7. That´s right!
    I´m spanish, so I´m used to pay what it says. And when travelling to US, I´m always surprised when paying with a higher price! I hate it! And never get used to it! :-(

  8. If you ever come to Canada, which I doubt you would want to, you will find that the sales tax here is ridiculous. Even though Canadian dollar is basically as strong as (if not stronger than) the US dollar, the same merchandise is priced higher in Canadian dollars. and the tax of 13% on everything just makes it even worse. So we travel to US over long weekends/holidays to shop and its worth it. Of course Europe and Hong Kong is where I find the best shopping is. Basically no tax and so much more stock. But bringing the stuff back is another story. I once got caught at the custom for bringing a new Balenciaga bag back and got a huge 40% fine. Now i’m blacklisted and got checked at the custom every freaking single time. I wonder if you ever get checked at the custom and sometimes they literally go through everything that you have!!!

    http://style229.blogspot.com/

  9. i think it’s a lack of maturity on the part of Americans, unfortunately. We are very absorbed by OUR circumstances, not so much of foreign tourists.

  10. Sales tax is not a VAT, it’s taxing commerce itself and is at the local and state level. The exact percentage will vary from state to state and even city to city within a state. Most states have no regulatory mechanism to collect sales tax from non residence, leaving out of state on line purchases de facto sales tax free. There’s no reason they couldn’t include taxes (and fees and whatever else might apply) on the sticker price of things, it’s just not typically been done that way. States and cities with higher taxes prefer it not be included as it helps mask the total cost until the point of purchase. Unless someone does the math item by item themselves of course.

  11. As an American who lives abroad I most definitely can sympathize with you Bryan. That said you’re obviously aware of the American taxation system, how it does vary state by state, and know what you’re getting yourself into when you come to the United States for work or play.

    Secondly while I don’t think this is the focal point of your post, tipping in the US is just part of American culture plain and simple. The way I hardly/don’t tip in Europe is tantamount to the way I normally leave 20% in the US. This aspect of our culture is similar to how each state has its own unique identity and taxation practices. Surakmn makes a great point when he/she touches on this and points out that sales tax in the US is not VAT.

    To end sorry our taxes frustrate you. We’re definitely not perfect as a country and there’s a lot we could and do need to improve on. However our system works and at the end of the day you can’t compare an apple (Europe per se) to an orange (the United States) as they are both incredibly different beings.

  12. It is true that it can seem unfair…
    As a french citizen, it is always a relief to know that the price on the tag IS the Final price you are going to pay.
    When in the US, it is always harassing not to forget you have to pay for the tax plus the tip. But I guess that’s part of it.
    I agree with what sarah said previoulsy, that’s part of the culture !

  13. BRYAN, i guess u might be mistaken sumwhere ! I mean I live in India.. and we pay the price what we see in broucghers or catalogues, or even on seller’s online page.. it is inclusive of all sales taxes and vat !

  14. ZFASHIONBLOG: I just checked again and it’s only in certain states like Texas, since I lived in Mexico very close to Texas, and do most of my shopping there, I always figured it was the way the country worked. Sorry.

  15. Wahahaha to Sarah -> “We’re definitely not perfect as a country and there’s a lot we could and do need to improve on. However our system works”

    Funniest thing I’ve heard in months!!!

  16. If anyone offered me an American passport to live there for free, I would say no. I was once asked by immigration at JFK if i intend to overstay and i told him, that if my boss did not send me here for my assignment i would never ever want to visit America EVER. He was not very happy.

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