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Duty-free products aren’t always cheaper, Consumer NZ finds

Duty-free products aren’t always cheaper, Consumer NZ finds

A survey of 33 duty-free items finds only 10 are cheaper at duty-free stores than other retailers.

Consumer NZ chief executive Sue Chetwin says confectionery is the worst value at the airport chains Aelia Duty Free, JR Duty Free and The Loop Duty Free. All seven products evaluated were selling for a better price at supermarkets or big box retailers.

“If you’ve got a particular product in mind, it’s worth doing an internet search to see which price really constitutes a bargain, before heading to the airport,” Ms Chetwin says.

The investigation found duty-free spirits, particularly liqueurs, were consistently cheaper. But considering excise duty and GST often add up to half the price of a bottle of vodka, gin or whiskey, it can be less of a bargain than a consumer might expect, she says.

On the day of Consumer NZ’s price survey, a bottle of Jack Daniels – subject to $21 of alcohol duties and levies at the border – was only $5 cheaper duty-free.

“When you remove alcohol duty and GST from the sticker price, consumers might expect to see more significant savings when they shop duty-free than they get,” Ms Chetwin says.

The Commerce Commission warns businesses using the term “duty-free” to ensure customers are not being misled about pricing, something the Fair Trading Act prohibits.

It also advises duty-free stores to “clearly identify” goods that are not subject to duty. Consumer NZ found nothing prominent alerting customers to this information in its investigation.

“Shoppers should be informed what is duty-free and what is not,” Ms Chetwin says.

Consumer NZ believes the inflated confectionery prices and lack of disclaimers on items not subject to duty may be misleading to travellers. It is lodging a complaint with the commission.

“The Fair Trading Act obliges duty-free stores to ensure their prices aren’t at risk of misleading or deceiving their customers, whether they are from New Zealand or just in the country for a short holiday. While we encourage consumers to do their research before they buy duty-free, the ability of people to do this doesn’t release duty-free businesses from their legal fair trading obligations,” Ms Chetwin says.

The full report is available in the August edition of Consumer magazine and at consumer.org.nz.

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