What is a Duty Free Zone?

The Duty Free zone is an area where products are sold without the import, sales, value-added or other taxes. These products are sold to the international travelers with an understanding that they will take these products outside of the country to use. The products are tax exempted to entice the international customers in buying the products.

How do Duty Free Zones Work? 

The stores selling duty free products are typically situated at international airports, sea terminals, and international train stations. Duty free products are also available on-board cruise ships and international flights. Some countries impose a tax on good brought to the country from a duty free zone. Also, there is an upper limit imposed on the volume of the product you can bring into a country from a duty free zone. The duty free shops offer branded upmarket luxury goods at a low price as you do not have to pay the taxes attached to in the domestic market. In European Union, you need to pay the duties for the goods while traveling between EU countries but the goods are duty free when you take it outside the Europe. Duty free shops are not generally available on the roads or trains but there are several duty free shops at U.S.- Canada and U.S.-Mexico border. The applicable duty free regulation depends on the country of residence, destination country and length of stay. It also depends on the item, cost of the item and country of its manufacturing.