Money matters: Taxes and duty free

Since the 1999 ban on duty-free shopping in the European Union, Value Added Tax (VAT) and excise duty have been included in the price of certain goods. But airports, ferry companies, ports and the Channel Tunnel operators absorb one or other of these costs - so travellers do not have to pay them.

EU countries

You can no longer buy duty-free goods in these countries: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Irish Republic, Italy, Luxembourg, the Netherlands, Portugal, Spain (not the Canary Islands), Sweden, the UK (not the Channel Islands).

Duty-free goods

Products free of excise duty or VAT

Only applies to tobacco products and liquor

Now only available in non-EU countries, such as the US

Tax-free goods

Goods free of VAT - currently 17.5% in the UK

Applies to perfume, cosmetics, electrical goods, fashion and accessories, gifts, jewellery, souvenirs, watches, photographic equipment and confectionery

Available to all passengers after security control at shops in UK airports, at the Channel Tunnel terminal and at ports

Duty-paid goods

Goods free of the excise duty added to items made and sold in their country of origin

At UK airports, usually applies to limited selections of tobacco products and liquor

Available to travellers visiting EU countries

Sold after security control at UK airports and in shops and supermarkets in EU countries

Customs allowances

By law, travellers can bring in a certain amount of tobacco, liquor and perfume from EU and non-EU countries. Travellers who bring back more than the limit must either prove the goods are for personal use or pay duty and UK VAT on them.

Limits for own-use goods bought in EU countries

800 cigarettes

400 cigarillos

200 cigars

1kg tobacco

10 litres of spirits

20 litres of fortified wine - such as sherry and port

90 litres of wine - 60 litres of which can be champagne/sparkling wine

110 litres of beer

Limits for own-use goods bought in non-EU countries (including the Canary Islands, Channel Islands and Gibraltar):

200 cigarettes or 100 cigarillos or 50 cigars or 250g of tobacco

Two litres of still table wine

One litre of spirits or strong liqueurs over 22% volume, or two litres of fortified wine, sparkling wine or other liqueurs

60cc/ml of perfume

250cc/ml of toilet water

£145 worth of other goods, including gifts and souvenirs

OTHER TAXES

AIR PASSENGER DUTY

From February 1, 2007, air passenger duty will rise from £5 to £10 for economy-seat passengers taking domestic and European short-haul flights, and from £20 to £40 for economy-seat travellers on long-haul flights.

Business and first class passengers will face bills of £40 for short-haul flights and £80 for long-haul.

Also known as departure or airport tax, this is a tax placed on flights leaving the UK.

Some countries may charge visitors a local tax for their return journey as well. It's worth checking before you depart whether this applies to your destination. If it does, you will need to pay the tax in local currency - so keep cash handy.

UK Customs and Excise Department: http://www.hmce.gov.uk