How Does Duty Free Work?

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If you’re traveling abroad for a vacation anytime soon, you’ll get to enjoy the fun and excitement of passing through Customs on your way home. Let’s take a look at a few of the other rules regarding duties and declarations, and see what's up with the duty free shop.

What am I supposed to declare to Customs officers?

As a general rule, you’re supposed to declare anything you’re bringing back from your trip that you didn’t take with you. Anything you bought or inherited while abroad has to be declared. If something you took abroad with you received any repairs or alterations, you have to declare those, too. (The Customs website specifically mentions that these repairs have to be declared even if you didn’t pay for them; might be worth declaring “button sewn back on shirt” the next time you pass through Customs.)

How much stuff can I bring back duty-free?

The size of the duty-free exemption varies a bit depending on what country you’ve visited, but if you’ve spent at least 48 hours out of the country, you can generally bring back up to $800 worth of merchandise for your personal use or to give as gifts. There are exemptions to these exemptions, too; under various growth programs for places like the Caribbean and sub-Saharan Africa you can bring back more duty-free items. Also, fine art is duty-free.

You can only use this $800 exemption or any part of it once every thirty days. If you’ve already used your exemption for one 30-day period or if you haven’t been out of the country for at least 48 hours, you can still get an exemption of $200.

Ack! I wanted to bring back something that cost $1,200! Is there any way to circumvent the law?

Yes. Get married. Family members who live together can combine their exemptions using a joint declaration. If you want to bring in something that’s $400 more than your personal exemption, you can combine, declare jointly and “borrow” $400 worth of your family member’s exemption.

Any other ways around the rules?

If you’ve got enough foresight, you could always have another kid to help save on customs duties. (We didn’t say it was cost-effective, just that it was possible.) The U.S. Customs website features this terrific quote: “Children and infants are allowed the same exemption as adults, except for alcoholic beverages and tobacco products.” Our deepest condolences if this rule foils your plan of using your infant as a duty-free mule for that sweet, sweet Scandinavian snuff.

Wait, I bought this in the duty-free shop! I don’t have to pay duties on that, right?

Yes, you do. “Duty-free” is a tricky term. You don’t have to pay the duties of the country where you originally purchased the item, which is why the prices are often inexpensive compared to what you’d find in a normal store. (The kinds of items that duty-free shops tend to carry, like liquor, cigarettes, and perfume, would otherwise have high excise taxes bumping up their prices.) However, you’ll have to declare your purchases once you get back home and pay duties on them if they fall outside your exemption.

Let’s cut to the chase: I just want to bring back booze and smokes. What are the rules there?

What an outlaw! Alcohol and tobacco operate a little differently under the exemptions. Alcohol is the easier of the two: adults are allowed one liter under their normal exemption. After that, you’ve got to pay duty on any booze you’ve got with you, but you can bring in as much as you want within reason. If you’re bringing in gobs and gobs of alcohol, though, Customs agents might make the judgment call that you’re importing it for resale, in which case they’re allowed to confiscate it.

Tobacco is a bit slipperier. Within the standard $800 exemption you can ferry in up to 200 cigarettes and 100 cigars. If you want to bring in more than 200 cigarettes, they’d better be foreign-made; any previously exported American cigarettes over the 200-smoke allocation are up for confiscation. It’s okay to bring in more than a carton of foreign cigarettes, but you’ll have to cough up duties on anything over 200.

Oh, no! I went over my exemption. These duties are going to clean me out, aren’t they?

Not unless you’re unusually destitute for an international traveler. The rate varies depending on the country from which you’re returning, but the duties are still pretty low. For most countries, the first $1,000 worth of merchandise after your exemption (including any tobacco or liquor over your exemptions for those) is taxed at three percent of its retail price.

The relatively low duty rates are a good reason to follow Customs’ advice about erring on the side of caution with your declarations. So you’ve got an extra $25 bottle of liquor? The duty on that would be a whopping 75 cents. You’re probably better off declaring it and potentially shelling out the spare change instead of making Customs think you were trying to pull an extremely low-stakes fast one on them.

Customs agents have to process over a million travelers a day, though, and they’re trying to keep important things like drugs and guns out of the country. Since it’s not worth Customs agents’ time to fill out paperwork and go to the trouble of collecting an extra buck or two from tourists, there’s lots of anecdotal evidence that suggests you’ll just get waved through unless you owe quite a bit in duties.

Are there any other odd Customs laws I should know?

Yes, particularly if you’re in the market for a nice cat-fur sweater. Here are a few choice Customs regulations you might not have known:

• You can bring absinthe back home with you, but it must be free of thujone. Also, according to Customs, “the term ‘absinthe’ cannot be the brand name; the term ‘absinthe’ cannot stand alone on the label; and the artwork and/or graphics cannot project images of hallucinogenic, psychotropic or mind-altering effects.”

• You can’t bring in any products containing dog or cat fur.

• Haitian animal hide drums may not make it back into the States thanks to a risk of cutaneous anthrax.

Note: A version of this story originally appeared last year. It was lost in a server meltdown.

Australian Accounting Firm Offers Employees 12 Weeks of ‘Life Leave’ to Strike the Perfect Work-Life Balance

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iStock.com/karenfoleyphotography

What would you do if you could take a three-month vacation each year? Would you book a flight to Hawaii, catch up on your favorite Netflix shows, or simply spend some quality time with your partner, kids, or dogs? The employees at one Australian accounting firm undoubtedly have a few ideas about how to spend the six to 12 weeks of “life leave” they will soon be granted.

As Travel + Leisure reports, Ernst & Young Oceania decided to introduce more flexible work hours in an attempt to attract and retain top talent. “We’re innovating so we don’t lose these people while they pursue passions outside of work,” company official Kate Hillman told The Independent. Hillman went on to cite volunteer experiences, training programs, and even a trekking trip to Nepal as different ways that employees might take advantage of the new policy, which goes into effect April 1.

Employees can either use their leave all at once or split it into two smaller vacations. The only catch is that the leave is self-funded—so it’s essentially an unpaid vacation. Still, if someone has the burning desire to backpack through Europe for a couple of months, or work on a project, it’s a safer option than quitting their job only to return unemployed and broke.

In addition to this policy, employees can choose to reduce their hours to a part-time schedule for up to three months each year. Parents may also choose to take advantage of a term-time arrangement, which lets them work regular hours when school is in session, then take time off during school holidays.

According to the firm’s research, flexibility at work boosts employee engagement by 11 percent. There are plenty of other reasons to take a vacation, too—not the least of which is evidence that time off may help you lead a longer, healthier, and happier life. Plus, you’ll come back refreshed and motivated, so your boss will be happy, too.

[h/t Travel + Leisure]

The World's 10 Most Expensive Cities

An apartment complex in Hong Kong
An apartment complex in Hong Kong
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If you think San Francisco is pricey, you should see some of the other metropolises that appear in a new ranking of the 10 most expensive cities in the world. As The Real Deal reports, Singapore, Paris, and Hong Kong have been jointly named as the three cities with the highest cost of living in a new analysis by The Economist Intelligence Unit (EIU).

It was the first time in the history of the Intelligence Unit’s Worldwide Cost of Living report that three cities have tied for first place. Billing itself as a global business intelligence group, the EIU takes the prices of more than 400 items into consideration for its annual list, including food, clothing, household supplies, private school fees, and recreation.

Singapore's appearance on the list is no surprise, considering that it has been crowned the world’s most expensive city for the past five years in a row, and Paris has consistently made the top 10 since 2003. Hong Kong, meanwhile, rose three places in the newest ranking, while Osaka, Japan rose six places.

New York City and Los Angeles also made the top 10 list this year, tying with other cities for fourth and fifth place, respectively. This is partly due to exchange rates.

“A stronger U.S. dollar last year has meant that cities in the U.S. generally became more expensive globally, especially relative to last year’s ranking,” the report notes. “New York has moved up six places in the ranking this year, while Los Angeles has moved up four spots.”

Check out the 10 most expensive cities below, and visit the EIU’s website to download a full copy of the report.

  1. Singapore; Hong Kong; and Paris, france (tied)

  1. Zurich, Switzerland

  1. Geneva, Switzerland; and Osaka, Japan (tied)

  1. Seoul, South Korea; Copenhagen, Denmark; and New York City (tied)

  1. Tel Aviv, Israel and Los Angeles (tied)

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