Many of our favorite luxury brands have their origins in France – so does this mean that luxury brands are cheaper in Paris? We’ve got an answer to that question.
Paris, as one of the fashion capitals of the world, is the home of countless top fashion houses, including Givenchy, Louis Vuitton, Chanel, Hermès, and Dior, and is a place you have to visit if you love luxury fashion.
But should we be buying our luxury goods when we are in Paris? Are luxury goods more expensive in the United States or the United Kingdom? Keep reading to find out the answers to all these questions!
Are Luxury Brands Cheaper in Paris?
The answer to this is a definite yes! Many luxury brands offer cheaper pricing in France than they do in the USA or the UK – this is particularly true for French or Italian brands.
However, American brands, such as Coach and Tory Burch, or British brands, such as Burberry or Alexander McQueen are usually not cheaper in Europe – we will get into why this is the case shortly.
Why are Many Luxury Brands cheaper in Paris?
There are a couple of main reasons why luxury brands are available at cheaper prices in Paris, other French cities, and even other European countries.
1. Price Discrepancies
Although luxury brands try to maintain similar prices on their products around the globe, it’s not unheard of that some products will be cheaper in certain countries than others. Typically, this will be the country or area where the brand is from.
One part of the reason could be that many European luxury brands manufacture at least some parts of their pieces in Europe, meaning that in the process, the products accrue less tax, duties and other fees when they are sold in Europe (as there is free trade in the EU), which could be reflected in the price.
For example, if we look at Louis Vuitton’s Pochette Metis, the price is currently €1,900 ($1,850) in France, £1,780 in the UK ($1,975), and $2,570 (+tax) in the US.
2. VAT Refunds
The second reason why prices are usually cheaper in the EU and France is the VAT tax refund system that is established in countries of the European Union.
In short, you will be refunded the VAT (i.e. sales tax, which is already included in the price) on products over a certain amount, which in the end makes the product cheaper overall. This will be explained in more detail further below.
France’s current VAT refund rate is 12 % at the moment, according to Upon.io.
3. Mandatory Sales
Secondly, there is a law in France that states that brands have to have annual sales twice a year, at the same time each year.
The summer sales begin on the last Wednesday of June, while the winter sales start on the second Wednesday in January – we would definitely recommend planning your luxury shopping trips and visits to your favorite boutiques around these dates because you are bound to get a great deal!
However, it is worth noting that some brands have specific products that they do not include in the sale, for example, in the sale of Louis Vuitton handbags, you will not find the Neverfull because this is an item LV never reduces the price of.
4. No Added Sales Tax
Unlike some US states, the final price of a product is the price that you see on the tag – all sales taxes (i.e. the VAT, or value added tax) are already included in this price.
So, if you are from a state that has a sales tax that is anything above 0%, you are most probably getting the items at a slightly cheaper price.
5. Favorable Exchange rates
Lastly, you may sometimes get a better deal in European countries thanks to the ever-changing exchange rates. At the moment, the dollar is particularly strong, so it is a good time to go shopping in Europe and take advantage of the cheaper prices of luxury goods.
What is the VAT refund?
European countries (like some other countries in the world) use a system in which, when spending over a certain amount of money, foreign shoppers can receive a VAT refund.
VAT stands for Value Added Tax, and it is automatically included in the final price of most consumer goods. However, if you are a foreign buyer, you do not need to pay it.
There are certain rules to this system and certain things you need to remember to do so you receive this refund.
First of all, to qualify for this refund, you need to be:
- Older than 16 years old
- A non-EU citizen (British citizens are now applicable for this VAT refund as the UK is no longer part of the EU)
- You cannot be in France for longer than six months
- You need to spend more than €100.01 in a single store, in a single day
The refund system is therefore perfect for if you are on holiday in Paris and looking to pick up a new designer handbag!
It is worth noting that this system is not available just in France, but in all EU countries – great news! However, the UK government has recently removed the VAT refund system in the UK, so this does not apply if you are buying any luxury goods in London.
How To Claim Your Refund
Most of the time, sales assistants will automatically fill in the paperwork for your refund, but make sure to double-check so you don’t miss out!
You can receive this VAT sales tax back immediately in cash – you will receive 10.8% of your purchase back if you leave the EU within 21 days. Or you can wait a little bit longer and receive the refund via your credit card, this may take up to three months but you will get 12% of your purchase back.
It’s very important you remember to drop your tax refund paperwork off at the airport. At Paris – Orly or Paris – Charles de Gaulle airport, locate the tax refund desk, scan the document, and pop it into a mailbox, which is located in the terminals at both of these airports.
Finally, it’s important to note that you will be subject to pay duty on your purchases – this is normally 3% in the US and 2.5% in the UK after your personal exemption (normally $800 in the US, £390 in the UK).
What About American & British Brands?
If you are buying something from an American designer brand, such as Tom Ford or Coach, the price of the products will not be cheaper in Paris. The same goes for the UK: British brands will typically be lower in price in London as the goods are not being exported to a different country.
With this said, if you are visiting from abroad, you can still take advantage of the VAT refund scheme and the annual sales.
Are Prices Cheaper For EU Citizens?
If you are looking to visit Paris from another country in the European Union, the price of the luxury goods is almost definitely going to be the same, unless you’re coming from a country that doesn’t use the euro.
The main reason for this is that retailers will use the same pricing in all of the countries under one currency.
Furthermore, you won’t be eligible for the VAT refund, as you are an EU citizen and thus part of the same common trading area. However, you can still take advantage of the sales if you happen to visit during this time.
Your Potential Savings
Here’s an example of how much money you could save if you bought a Louis Vuitton handbag in Paris.
If you are going to buy a Louis Vuitton Neverfull MM bag in New York, it will cost you $2,030, with an added $180 in tax, reaching a total of $2,210.
If you are buying this same bag in the UK, it will cost you £1,410 ($1,563)
If you buy the LV Neverfull in Paris, it would cost you €1,500 ($1,460).
If you were to choose the 12% VAT refund that goes straight to your credit card, you would be refunded €180 (this is $175 at current exchange rates!)
This means, with the refund, the bag would cost €1,320 or £1,159 for British citizens, or $1,285 for American passport holders. However, before getting too excited, make sure that you calculate the amount of tax you will need to pay at customs.
In most cases, your personal exemption will be $800 in the US, after which you’ll be taxed at a flat rate of 3%. In our example, your total comes up to just $1,300 – that’s a saving of $910 compared to NYC!
As for shoppers from the UK, your personal exemption is £390, after which 2.5% duty is imposed (but this may vary depending on the product you buy, as stated by gov.uk). Given these figures, your LV purchase will come to a total of roughly £1,178, saving you £232!
Commonly Asked Questions
Is Louis Vuitton cheaper in Paris?
As a French brand, Louis Vuitton is cheaper in Paris than it is in the US or UK. The combination of lower prices in euro, as well as the VAT refund system, means you will get a better deal in Paris.
Is Dior cheaper in Paris?
Yes, Dior is much cheaper in Paris, France and other EU countries compared to the US and UK, thanks to the many reasons listed above, mainly the VAT refund scheme and the better pricing in euro.
Is YSL cheaper in Paris?
Yves Saint Laurent is also a French fashion house, meaning the brand’s prices are typically cheaper in any EU country than elsewhere. Plus, you can get that tax refund too!
Is Cartier cheaper in Paris?
As one of the oldest jewelry brands in Paris, Cartier’s headquarters are in Paris too. This means the lowest price for Cartier jewelry is in France and other European countries.
Is Chanel cheaper in Paris?
As another French brand, Chanel is cheaper in Paris – thanks to lower prices, as well as the VAT refund you would be entitled to receive as a non-Eu resident.
Is Gucci cheaper in Paris?
Although Gucci is an Italian brand, it would also be cheaper to buy a Gucci product in Paris as opposed to the US or UK. One of the reasons is again, the VAT refund scheme. However, Italy is also part of the European Economic Area (EEA), meaning the products won’t inquire taxes on their way to Paris.
Other luxury brands that are cheaper in Paris and France include Hermès, Givenchy, Christian Louboutin, Lancôme, Guerlain, Longchamp, Celine, Diptyque, Bottega Veneta, Fendi, Prada, Dolce & Gabbana, Armani, Balenciaga, Salvatore Ferragamo, Versace, Loewe, Valentino and Moncler.
If you are not planning to buy a plane ticket to Paris anytime soon, then buying from a resale site is a great alternative.
Sites the Fashionphile and The Real Real always have great quality luxury goods on offer so you are bound to find something you love.
1. Louis Vuitton
Louis Vuitton has loads of absolutely stunning bags in their collection – the Alma and the Speedy are just two examples.
The Louis Vuitton Speedy is an iconic bag and in this, now-discontinued, multicolor monogram it is definitely a statement piece. The multicolor monogram was a collaboration LV did with Takashi Murakami for a limited time and is no longer available, so one of the best places to buy this bag is on Fashionphile.
The Alma is another instantly recognizable Louis Vuitton bag. The gorgeous curved shape is unique, and this version is in beautiful rose-colored epi leather, that has a very slight sheen to it which accentuates the texture of the leather. A lock and two keys come with this bag as well, a classic Louis Vuitton feature.
Chanel is one of the most famous French fashion houses, and their handbags are timeless heirloom pieces you will love forever.
The Chanel Boy bag is a more structured shoulder bag, that of course features quintessentially Chanel quilting. The turquoise caviar leather is emphasized by the silver chain strap and CC hardware push lock – this bag is perfect for adding a little pop of color to any outfit.
This super sumptuous Chanel quilted flap bag is completely stunning. This is a sophisticated Chanel classic that is always in style. The top handle and long shoulder strap make it so versatile, while the multiple interior pockets and exterior pocket mean this bag is totally practical as well!
The heritage of the Christian Dior brand is shown through their beautiful collection of irresistible handbags you need to get your hands on.
The Saddle Bag is equestrian-inspired in its unusual shape – there is no other bag like it. The calfskin leather is buttery-soft and features a matching shoulder strap and an aged-gold D logo. This Dior saddlebag would fit perfectly into any bag collection and bring a unique element to any outfit.
The Lady Dior bag is a timeless classic of the Dior cannon. You just can’t go wrong with the elegant style of a Lady Dior.
The leather is quilted in a geometric pattern and the chunky top handles and removable shoulder strap make this a beautiful yet versatile bag. This version of the Lady Dior is in an ultra-matte grey which accentuates the finer details of this incredible bag.
We hope you found this article on whether luxury brands are cheaper in Paris helpful! For more luxury fashion content, check out the posts below.