How to Get Your VAT Tax Refund
A VAT Tax Refund is a value-added tax from an overseas purchase. When visiting a European destination such as Italy, an individual will pay a price for some goods that will include a VAT. The majority of countries in Europe rely heavily on VAT as part of their annual revenue, considering it an export tax.
A value-added tax refund or VAT is a refund of taxes paid on something purchased while traveling in a European country. The countries in Europe rely heavily on the income from the VAT because they believe they are exporting items with tourists.
In order to prevent fraud, a tourist is required to present proof of the purchase before a refund would be issued. Additionally, VAT can only be claimed on merchandise and will not be refunded on such items as restaurant meals, hotel stays or rental cars even though theses items each carry heavy VAT fines.
- Shop only where you see a "Tax-Free Shopping" sign. A tourist could receive their refund in the form of a refund. When the tourist is finished with her shopping, the cashier will hand her a VAT refund cheque or a tax-free shopping cheque, which represents the amount of the refund.
- Have the customs agent stamp the cheque.
- Inspecting the merchandise is also part of the custom agent's job to verify that the merchandise was purchased in the country.
- Go to the window of the company that issues the cheque. This is where a cahs or credit card refund will be issued depending on how the purchase was made. Many people are disappointed in their VAT refunds because what they see on the cheque is not the amount they receive from the service desk of the cheque issuing company. This is because the company will take out a handling fee before a conversion is figured. Many of the handling charges are upwards of 25-30 percent of the items total value.