The Economics of Duty-Free Shopping

In 1999 the EU abolished duty-free on intra-EU travel, whilst other countries still retain duty-free shopping for international travellers. We address several aspects of duty-free trade, including effects on consumption, revenue and price-setting. From a global perspective we identify the distortions generated by duty-free trade. We review, and dismiss, various arguments that might conceivably support a role for duty-free in promoting global economic welfare. The existence of duty-free trade is explained as a phenomenon that individual countries find in their national self interest as seen both from the arrival and the departure end, i.e. countries have reasons both to admit duty-free goods and to permit their sale to departing passengers.

Trade and Employment Effects of the Andean Trade Preference Act - 2006

[Excerpt] The submission of this report to the Congress continues a series of reports by the U.S. Department of Labor on the impact of the Andean Trade Preference Act (ATPA) on U.S. employment. The current report covers calendar year 2006 and represents the fourteenth in the series. The ATPA, enacted on December 4, 1991, authorized the President to proclaim duty-free treatment for eligible articles from Bolivia, Colombia, Ecuador, and Peru. The ATPA expired on December 4, 2001, but was subsequently expanded in product coverage and renewed to December 31, 2006, by the Andean Trade Promotion and Drug Eradication Act (ATPDEA) that was signed into law by the President on August 6, 2002. Prior to its expiry, on December 20, 2006, the program was extended for six months and, on June 28, 2007, it was extended for an additional eight months through February 2008. Section 207 of the ATPA directs the Secretary of Labor to undertake a continuing review and analysis of the impact of these preferences on U.S. employment and submit a summary report of such analysis annually to the Congress. During 2006, $13.5 billion in U.S. imports from the beneficiary countries entered the United States duty-free under the provisions of the APTA. This represents about 60 percent of all U.S. imports from the beneficiary countries in 2006, but just 0.7 percent of total U.S. imports from all sources. This$13.5 billion in imports includes $2.9 billion in imports that entered duty-free under the provision of the original ATPA (excluding the ATPDEA amendments) and$10.6 billion in imports that entered duty-free under the ATPDEA’s provisions for expanded product coverage. Of the $2.9 billion in imports that entered duty-free under the provision of the original ATPA (excluding the ATPDEA amendments), approximately one-third or$1 billion, could have qualified for duty-free entry under the Generalized System of Preferences (GSP) and were not exclusive benefits of the ATPA. All items that entered under the ATPDEA’s provisions for expanded product coverage were exclusive benefits of the ATPA. Overall, U.S. imports from the beneficiary countries that benefited exclusively from the original ATPA (on eligible products not eligible for GSP) and the ATPDEA amendments (all covered products) amounted to $12.5 billion in 2006, which represented about 56 percent of all U.S. imports from the beneficiary countries, but just 0.7 percent of total U.S. imports from all sources. The main finding of this report is that preferential tariff treatment under the provisions of the original ATPA and the ATPDEA amendments has neither had an adverse impact on, nor posed a significant threat to, U.S. employment

On Trade Policy Reform and the Missing Revenue: an Application to Mozambique

In many developing countries, large discrepancies exist between revenues implied by published tariff rates multiplied by estimated import volumes and actual receipts. We develop a stylized trade model where average and marginal tariff rates diverge and incorporate insights from this model into a computable general equilibrium model of Mozambique to study the implications of trade policy reform. Model simulations indicate that lowering tariff rates and reducing duty free importation in a manner that maintains official revenue benefits nearly everyone with the main exception being those, who benefited from duty free imports in the base.trade policy; public revenue; Mozambique

Lessons of the 1999 Abolition of Intra-EU Duty Free Sales for Eastern European EU Candidates

At the end of June 1999 the intra-EU duty free shopping was abolished among the fifteen member nations. The opponents of this resolution argued that such a tax-free sales sector created jobs EU-wide and hardly reduced the value added and excise tax revenue of individual countries. In their opinion, duty free trade not only contributed to the reduction of travel fare within the EU but could also be characterised as a supplement to the normal retail trade for some products. Such ‘old’ ideas are increasingly popular in some Eastern European EU candidates where they are preparing for the introduction of the Single Market and EU membership in the near future. This study primarily shows that the arguments mentioned above were neither significant enough nor conclusive to maintain the intra-EU duty free shopping. Furthermore, the abolition of such tax free sales was approved in the EU in order to ensure the allocation efficiency of the VAT and excise tax system within a single market. Several arguments against the intra-EU tax free shop-ping examined in the study provide some helpful policy orientations for EU membership candidates.

Lessons of the 1999 Abolition of Intra-EU Duty Free Sales for Eastern European EU Candidates

At the end of June 1999 the intra-EU duty free shopping was abolished among the fifteen member nations. The opponents of this resolution argued that such a tax-free sales sector created jobs EU-wide and hardly reduced the value added and excise tax revenue of individual countries. In their opinion, the duty free trade not only contributed to the reduction of the travel fare within the EU but also could be characterised as a supplement to the normal retail trade for some products. Such ‘old’ ideas are increasingly gaining popularity in some Eastern European EU candidates in the context of the preparation process for the introduction of the Single Market and the EU membership in the near future. This study primarily shows that the arguments mentioned above were neither significant enough nor conclusive to maintain the intra-EU duty free shopping. Furthermore, the abolition of such tax free sales was approved in the EU in order to ensure the allocation efficiency of the VAT and excise tax system within a single market. Several arguments against the intra-EU tax free shopping examined in the study provide some helpful policy orientations for EU membership candidates.duty free shopping, EU single market, value added and excise tax harmonisation, eastern european candidates

The Costs and Benefits of Duty-Free, Quota-Free Market Access for Poor Countries: Who and What Matters

This paper examines the potential benefits and costs of providing duty-free, quota-free market access to the least developed countries (LDCs), and the effects of extending eligibility to other small and poor countries. Using the MIRAGE computable general equilibrium model, it assesses the impact of scenarios involving different levels of coverage for products, recipient countries, and preference-giving countries on participating countries, as well as competing developing countries that are excluded. The main goal of this paper is to highlight the role that rich and emerging countries could play in helping poor countries to improve their trade performance and to assess the distribution of costs and benefits for developing countries and whether the potential costs for domestic producers are in line with political feasibility in preference-giving countries.CGE modeling, trade policy, duty-free market access, technical barriers to trade,preference erosion

On-Call Duty Effects on Sleep-State Physiological Stability in Male Medical Interns

Background: On-call duty among medical interns is characterized by sleep deprivation and stressful working conditions, both of which alter cardiac autonomic modulation. We hypothesized that sleep stability decreased in medical interns during on-call duty. We used cardiopulmonary-coupling (CPC) analysis to test our hypothesis. Methods: We used electrocardiogram (ECG)-based CPC analysis to quantify physiological parameters of sleep stability in 13 medical interns during on-call and on-call duty-free periods. There were ten 33.5-h on-call duty shifts per month for interns, each followed by 2 on-call duty-free days, over 3 months. Measurements during sleep were collected before, during, and after an on-call shift. Measurements were repeated 3 months later during an on-call duty-free period. Results: The medical interns had significantly reduced stable sleep, and displayed increased latency to the first epoch of stable sleep during the on-call night shift, compared to the pre-call and on-call duty-free nights. Interns also had significantly increased rapid-eye-movement (REM) sleep during the on-call night shift, compared to the pre-call and on-call duty-free nights. Conclusion: Medical interns suffer disrupted sleep stability and continuity during on-call night shifts. The ECG-based CPC analysis provides a straightforward means to quantify sleep quality and stability in medical staff performing shift work under stressful conditions

Modelling the Consumption Behaviour of Heterogeneous Consumers: A Duty-Free Shop Case Simulation Analysis

Duty-free shops, which have emerged in major airports, first-tier cities, free trade zones and other places, have become ideal places for not only facilitating people to buy goods but also promoting the development of the local economy, which makes the study of the heterogeneous consumer purchase behavior in duty-free stores of great importance and great practical significance. Based on this, the agent model is used to study the purchase behavior of heterogeneous consumers in duty-free stores, the structure of the agent model is proposed, the consumer submodel and situation submodel are designed, and a service recommendation is made. On this basis, the consumer behavior is simulated and analyzed both with and without considering situational factors. The following conclusions are drawn: (1) The display, the month, holidays, and other factors have an important impact on the heterogeneous consumers of duty-free stores and affect consumers\u27 consumption behavior. (2) Salespeople\u27s recommendation rules and consumers\u27 purchase preferences affect consumers\u27 purchase behavior, which has an important impact on the types and quantity of goods consumers buy

Political crisis and suspension of duty-free access in Madagascar : assessment of impacts on the garment industry

The export-oriented garment industry in Madagascar has displayed robust growth, thus both contributing to the economy and creating formal employment opportunities. However, it experienced a critical situation after the political turmoil that occurred in 2009. Our investigation using the trade data demonstrates that suspension of duty-free access to the US market (AGOA) resulting from the turmoil had a greater impact on exports, 64%–78% reduction, than the turmoil itself. Our original factory-level data demonstrates that AGOA suspension increased the probability of closure by 57.8% for the factories supplying exclusively to US market, and reduced 6405 jobs for low-skilled positions during the post turmoil period. The factory-level adverse impacts are much less than those on export value at the industry level because of the maintained duty-free access to EU, which has provided an alternative market. It suggests that if EU also had cancelled duty-free access, adverse impacts would have been enormous. Given the general pattern of comparative advantage in low-income countries, unplanned cancellation of duty-free access for them hurts labor-intensive industries and low-skilled workers

Uma ponte entre dois países

TCC (graduação) - Universidade Federal de Santa Catarina. Centro de Comunicação e Expressão. Jornalismo.Comuns em aeroportos, as duty free shops, lojas que vendem produtos com redução ou isenção de impostos a pessoas em trânsito, também podem ser encontradas em cidades que fazem fronteira com o Brasil. Esta grande reportagem impressa investiga o impacto da instalação destas lojas em pequenas localidades fronteiriças brasileiras. A reportagem tem foco na experiência de Jaguarão, cidade de quase 30 mil habitantes no Rio Grande do Sul, na qual as duty free shops foram instaladas em Rio Branco, Uruguai, há uma década. As pautas da reportagem abordam questões legislativas e econômicas relacionadas à interferência das duty free shops no comércio local, e tratam das possíveis mudanças sociais causadas pelo turismo de compras gerado pelas lojas. O texto é construído a partir do ponto de vista dos moradores de Jaguarão, principais fontes da reportagem