page_title: Tax-free shopping
section_title: Tax-free shopping in the United States
hierarchical_section_title: Tax-free shopping / Tax-free shopping in the United States
caption_attribution_description: English: Welcome to Delaware sign on southbound Interstate 295 in New Castle County, Delaware
context_page_description: Tax-free shopping is the buying of goods in a foreign country and obtaining a refund of the sales tax which has been collected by the retailer on those goods. The sales tax may be variously described as a sales tax, goods and services tax, value added tax, or consumption tax.
  Promoting tax-free shopping and making it easier for tourists to claim the refund back has helped to attract travellers to many countries. TFS is subject to national regulations, such as minimum spend and restrictions on the types of products on which it can be claimed. Refunds can only be claimed on goods which are exported. However, buying goods tax free does not mean travellers are exempt from paying applicable taxes on their purchases when they get home.
context_section_description: Some jurisdictions in the United States allow a refund of sales tax to foreign tourists upon leaving the country.
  Tax-free shopping is a privilege enjoyed by all residents of United States jurisdictions without sales taxes, but through so-called "remote" sales—including sales to visiting out-of-state residents, sales via catalog, and sales via Internet—customers in a sales taxed jurisdiction may also make purchases in sales tax-free jurisdictions, notwithstanding the legal requirement to pay the equivalent (compensatory) use tax in their home state. Delaware is free of all sales taxes, excluding homes and cars (3% transfer tax for real estate, and a 2.75% tag fee for cars). The Christiana Mall near Newark, Delaware attracts shoppers from the nearby states of Maryland, New Jersey, New York, and Pennsylvania looking to save money on purchases from not having to pay sales tax. The Apple Store at the Christiana Mall claims to sell more iPhones than any other location in the chain due to Delaware's lack of sales tax. Merchants in tax-free New Hampshire regularly advertise to residents of adjacent Massachusetts, Vermont, and Maine the benefits of purchasing goods without sales tax, ignoring the fact that there is no general exemption from the use taxes when the goods are taken back home.  Many purchasers are unaware of the obligation to pay the tax, or file the necessary return, or of the fact that it is not the duty of a merchant to collect it from them and pay it indirectly. However, it is the purchaser's obligation to pay it directly to the state, often in connection with filing their annual income tax return.
  The liability of any non-exempt resident of a US state with a sales tax for payment of the equivalent use tax when purchasing goods from another state (or country) through mail-order, by telephone or through the Internet should not be confused with the issue of direct Internet taxes levied on Internet services themselves, such as bit taxes, bandwidth taxes, franchise taxes, and email taxes.  Most such levies are banned until 2014 by the Internet Tax Freedom Act Amendment Acts of 2007 which extends the provisions in the federal Internet Tax Freedom Act beyond its original 2007 expiration.
  Goods that would be taxable at home are taxable at the same rate when taken home or delivered, regardless of where or how they were purchased.  Numerous local sales tax and use tax exemptions exist according to taxpayer status (for example, there exist exemptions for charitable organizations), exemptions based on size of purchase (e.g., clothing under $110 in Vermont), and exemptions for specific types of goods (e.g., protective clothing, food, medication, and educational materials).
  Even customers from jurisdictions that levy sales taxes can in theory have additional tax liabilities when shopping in neighboring no-tax or lower-tax jurisdictions.  For example, if an adjacent state has a slightly lower tax rate than the purchaser's home, that shopper could face an additional tax burden even though the purchase was already taxed at the point of sale.  The difference in tax rates is referred to by collecting authorities as "tax discount".
  Taxing jurisdictions generally extend an exemption from use tax to commercial taxpayers that purchase business stock.  This type of exemption applies to goods purchased tax-free for resale, but lapses if the goods are converted to use by the company itself (for example, a company car, office supplies, and cleaning supplies).
  Some countries charge a value added tax (VAT) or goods and services tax (GST) that extends to retail purchases.  When those customers are residents of a US state having sales taxes on such goods, the VAT or GST taxes paid might be used as a credit against the amount of use tax otherwise owed, unless excluded, such as in Massachusetts.  However, when a post-travel refund of the VAT or GST is claimed, the purchaser's home taxing jurisdiction can then assert a claim for the full sales tax liability.
  Despite the fact that most shoppers are unaware of their use tax obligations, there are
caption: Delaware proclaims to be the "Home of Tax-Free Shopping" as the state does not have a sales tax
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