Neighboring countries lower junk limit: What Swiss shopping tourists need to know now

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The topic of shopping tourism is a hot topic. Already customs and return formalities. If Swiss retailers have their way, it will be much easier for the Swiss to import goods into the Alpine country at very low prices. Now Italy is making shopping in Euroland more attractive. Blick shows why the tides are rising again.

On Thursday, Italy lowered the threshold for VAT refunds in Italy. The so-called junk limit is now 70 euros. It was previously 155 euros. This means that Swiss shopping tourists, the majority of whom are the Ticino population, will reclaim Italian VAT on a total purchase of just 70 euros when they return to Switzerland.

There are various VAT rates in Italy: Normally it is 22 percent. The reduced VAT rate is 10 percent (certain food and medicines, theater tickets, etc.). A highly reduced rate of 4 percent is applied to basic foodstuffs and agricultural products. VAT rates on child care products such as feminine hygiene products and baby diapers were increased from 5 percent to 10 percent at the beginning of this year.

The Swiss Retail Federation calls for “Switzerland to give up.” The umbrella association of Swiss store operators (excluding large distributors) considers it a nuisance that “Italy is attracting shoppers with easier VAT refunds”. Local businesses are missing out on selling what tourists leave behind in Italian cash registers. According to retailers, the federal government loses “about 10 billion francs a year from the VAT tax base.” The Ticino Retailers Association sounds the alarm: “The constant erosion of sales figures” seriously jeopardizes the survival of many companies and therefore the preservation of employment.

As the small limit is halved, the incentive to shop in Italy increases. This is indisputable. The Swiss Retail Federation is calling for an end to the “double advantage” of foreign buyers over domestic consumers. He sees only one solution: lowering the value-neutral limit from the current 300 francs to 50 francs.

Anyone living in Switzerland and shopping across the border can currently import products worth 300 francs duty-free. Therefore, tourists who shop save a large amount of money. The federal government is currently examining measures to curb shopping tourism. In the future, the Swiss will be able to import duty-free goods worth only 150 francs instead of 300 francs.

Italy aligns with Switzerland’s other neighboring countries, which have long had lower thresholds for VAT refunds. Tourists who shop in Germany only get 50 euros back when they return. In Austria the threshold is 75 euros. In France, this figure is even higher at 175 euros.

Source :Blick