My aunt visited Paris a decade ago, and the answer back then was most certainly yes. Tourists lined up outside the Louis Vuitton store on Champs-Élysées, like they do today. The rumor was that back then, the French government controlled prices to incentivize tourists. If you were visiting from the U.S. or other parts of Europe, French luxury goods were less expensive in France (there were few Mainland Chinese tourists back then - quite a contrast to today).
Before my trip to Paris last summer, I googled relentlessly to see if this was still true. I found limited, and very confusing, information. I still can't tell you how involved the French government is with the price of a Birkin bag (especially because you can't even buy a Birkin bag these days, in France or anywhere else, but you sure can burn one if you've got $100,000 to spare...) but I can give you insights from my personal travels.
In August, 2011, the Euro/USD exchange rate was 1.43 USD for every Euro. At the time, French luxury goods in Paris were priced exactly the same as they were in the U.S. or Hong Kong (I've found through personal experience that prices in the U.S. (including tax) are exactly the same as they are in Hong Kong (even though there is no sales tax in Hong Kong), this makes sense since the HKD is pegged to the USD and I doubt Chanel is looking to create an intentional arbitrage situation), except that you got an additional 12% back as a tax refund at the airport. This meant that luxury goods were still cheaper in France, but only by 12%.
I just left Paris for Moscow yesterday, and the exchange rate currently is 1.22 USD for every Euro. Thanks to the European economic meltdown, French luxury goods are significantly cheaper in France than in non-EU countries - at this moment. If you hop on a plane to Paris tomorrow, you can probably make up the cost of your flight on one Chanel 2.55 bag alone. Aside from the drop in the Euro, nothing suggests these fashion houses are in the habit of making less per unit in France. Give them a few weeks and I'm sure they'll adjust their prices to make everything even again. There's still the 12% tax back, however, and that's not an insignificant number considering the prices of some of these items.
So where should you absolutely not purchase luxury goods? Mainland China, where import taxes make foreign goods nearly 30% more expensive and...Moscow. So it looks like I'll be sticking to caviar and vodka. Still, not too shabby.
Here was my favorite luxury item from this trip to Paris - aside from the classics, of course.
Louis Vuitton Sevigne PM (1460.00 USD, 1070.00 Euros)
There have been a rise in tax scams in current time and this time is no exception. All these swindle artists out there are amassing our sensitive facts to pillage our refunds with fake tax returns. This is a severe rip-off for the reason that all it involves is a computer and email addresses. The victim rarely comes in contact with the con hence why it is challenging to follow where or when the material was stolen. I'd read up on the particulars and protect yourself. http://www.tax-defense-network-news.com/2012-scams/
ReplyDeleteI live in Bangkok. I was shopping for my first chanel a few weeks ago. i priced it and then looked around at prices elsewhere. Back home in Australia it is a little more expensive but to buy it in France is an amazing saving.
ReplyDeleteI have bought a flight, 2 nights at the Hyatt, a bus tour, a private shuttle to the airport and back AND a larger size Chanel bag for the same price it was going to cost me to drive into downtown BKK and pick up the smaller size bag at more local store! And that is not including the tax back I will pick up on the way out, an amount that is double the refund VAT in Thailand.