What Is the VAT in Paris & How Does the Refund Work?
Navigate Paris shopping with clarity. Learn about France's consumption tax, its presence in prices, and how non-EU visitors can reclaim eligible amounts.
Value Added Tax (VAT), known in France as “Taxe sur la Valeur Ajoutée” (TVA), is a widespread consumption tax applied to most goods and services. Understanding how VAT functions is important for consumers, especially those visiting cities like Paris, as it impacts the final price paid for various purchases.
Basics of Value Added Tax
Value Added Tax operates as a consumption tax levied on the “value added” at each stage of a product’s or service’s journey through the supply chain. Businesses collect VAT on their sales and pay VAT on their purchases, remitting the difference to the government. This mechanism contrasts with a sales tax, which is typically added only at the final point of sale to the consumer.
The final consumer ultimately bears the cost of this tax, as it is included in the price they pay for items. Businesses act as intermediaries, collecting the tax from customers and then forwarding it to the national tax authorities.
VAT Rates in France
France applies several different VAT rates depending on the type of goods or services being sold. The standard VAT rate in France is 20%, which applies to the majority of goods and services. This rate is common for items such as clothing, electronics, and many general retail purchases.
A 10% reduced rate applies to items like restaurant services, hotel accommodations, and passenger transport. A further reduced rate of 5.5% is applied to basic necessities, including many food products, books, and tickets for cultural events and cinemas. Additionally, a super-reduced rate of 2.1% is reserved for specific pharmaceuticals and certain newspapers.
How VAT Affects Consumer Prices
In France, and throughout the European Union, prices displayed to consumers are generally inclusive of all taxes, indicated as “TTC” (toutes taxes comprises). This means the price you see on a tag or menu is the final amount you are expected to pay, as the Value Added Tax is already incorporated.
Receipts often detail the VAT amount, either as a total sum or broken down by the different rates applied to various items purchased. For example, when you buy a new piece of clothing or an electronic device, the 20% standard VAT is already factored into the sticker price.
Claiming a VAT Refund as a Tourist
Non-European Union residents visiting France may be eligible to claim a refund of the VAT paid on certain purchases, a process commonly known as “détaxe.” To qualify for a refund, individuals must be at least 16 years old, reside outside the EU, and have stayed in France for less than six months. A minimum purchase amount per store, often around 100 EUR, must be met for the goods to be eligible for a refund.
The process begins at the point of purchase in participating stores. When making an eligible purchase, inform the sales assistant that you intend to claim a tax refund. You will need to present your passport as proof of non-EU residency to the retailer. The store will then issue a “detax form,” which may be a physical paper document or an electronic form often processed through third-party tax refund services like Global Blue or Planet Tax Free. This form requires personal details, including your name, address, passport number, and preferred refund method, along with details of the purchased goods.
Before leaving the European Union, you must validate your detax form at a customs office or an automated PABLO kiosk, typically found at international airports and major train stations. It is important to have the purchased goods readily available for inspection by customs officials, as they may request to see them to verify your claim. For electronic forms, PABLO kiosks offer a quick validation by scanning the barcode on your form, while paper forms require a stamp from a customs agent.
After validation, you can receive your refund through various methods, including a credit card direct deposit, cash, or bank transfer. The timeline for receiving a refund can vary, ranging from a few days for cash refunds to several weeks for credit card or bank transfers. Be aware that administrative fees are often deducted by the tax refund service providers, meaning the full VAT amount is not typically reimbursed; tourists generally receive about 12% of the purchase value back, even with a 20% VAT rate.