Understanding Duty-Free vs. Duty Paid

Summer is the season when our terminals are bustling with vacation travelers. Suits and ties give way to a sea of flip-flops, strollers and casual attire. Some are heading to U.S. destinations, but many are flying internationally. Regardless, along the way, travelers are sure to spot an airport staple: the duty-free, duty-paid shop.

EJE Retail Duty-Free/Duty-Paid is in Terminal 2 on Concourse C.

EJE Retail Duty-Free/Duty-Paid is in Terminal 2 on Concourse C.

A few years ago, I traveled to the Middle East with a long layover in Istanbul. In the beautiful Ataturk airport, there were gigantic duty-free stores that spanned the length of concourses. They included everything from American-branded apparel to exotic spices, DVDs and local wares. I had seen duty-free stores before, but nothing to that scale.

I remembered that experience one day when stepping into EJE Travel Retail Duty-Free/Duty-Paid on Concourse C in Terminal 2. It struck me that duty-free and duty-paid were terms that were familiar, but that I couldn’t quite define. I called Ingrid Hairston, RDU’s Director of Business Development, to help set me straight.

The Definition of Duty-Free

Duty is another word for tax. It’s a word that has its roots in the Latin term for to owe, but its current meaning as a tax on imports or exports came about in the 15th century. The term duty-free is a more recent term, dating back to 1958.*

How Duty-Free Works

Duty-free merchandise is sold without tax being applied and it is sold only to departing non-stop international travelers. They receive custody of their purchase when they leave the country, which is when they board their flight. (That’s why you might see EJE Travel Retail closed for a few minutes during the day as they deliver purchases to travelers at the gate.)

The purchasing of duty-free merchandise doesn’t count if you’re heading to Tokyo from RDU with a layover in San Francisco, for example. You’re able to purchase duty-free goods, though, if you’re heading non-stop from RDU on one of our daily flights to London or Toronto or our seasonal flights to Cancun or Freeport.

Only certain items are sold in the duty-free section based on the preference of travelers at each airport, as well as local restrictions. In general, duty-free items tend to be high-end, high-demand or both. Tobacco, liquor, perfume, jewelry, apparel and confections are such items. At RDU, only liquor and tobacco are duty-free items.

Duty-Paid Items

At EJE Travel Retail, duty-free items are separated from duty-paid items by a set of glass doors inside the shop. Duty-paid simply means that you pay the tax, which is just like any item you buy in any other store. For this reason, anyone traveling anywhere can purchase a duty-paid item. At our airport, this includes a wide range of perfumes, jewelry and confections, among other items.

Next time you travel and see a duty-free shop, especially if you’re traveling abroad, take a moment to stop in and explore. You’ll be in the know as to which products are tax-free or taxable.

Do you have any travel terminology questions? We’d love to help you solve them. Let me know in the comments below!

*Here is the reference regarding the word duty.

About Andrew Sawyer

Andrew Sawyer is the External Communication Specialist for the Raleigh-Durham Airport Authority and is the main writer for RDU’s website, electronic communication and airport publications. He’s also the primary face behind RDU’s social media channels. Andrew also assists with many other things, from media relations to event planning. In fact, he has an advanced degree in "other duties as assigned."
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