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VAT for hotel stays?

One of our biggest expenses in Europe is hotel and B&B charges. Cannot find in Rick or other guides a list of exactly what VAT applies to, and what it omits. Is there VAT on meals? On hotels? Thanks all, Tony

Posted by
9110 posts

The easiest way to deal with vat is to forget about it since it's already included in the quoted price - - it's not an add-on like sales tax. With exceptions, you can get it back on goods at departure. It's generally not worth the bother unless you buy a bunch of stuff.

Posted by
1986 posts

I understand that the VAT refund only applies to stuff you buy and take out with you- specifically excludes hotels and meals.

Posted by
10344 posts

"Cannot find in Rick or other guides a list of exactly what VAT applies to, and what it omits. Is there VAT on meals? On hotels?" Actually Rick does cover VAT refunds in some detail in his book, Europe Through the Back Door, several pages as I recall. As Brian & Ed already mentioned, you don't get a refund of VAT paid for hotels and meals (unless you're a business traveler).

Posted by
24 posts

Thanks to all.. that is what I suspected, but wanted to be certain. I have RS London 2011 and also looked at Frommer's London 2011, and did not find this information there. Do understand it's in other RS guides as indicated. Agree that getting a VAT refund is usually not easy, but if and when there's a lot of money involved, it would be worth the effort.

Posted by
32929 posts

One other thing to consider, the rules for reclaiming VAT are all based on you making significant purchases in one day from one seller - -and- - taking all the purchase out of the country (or Europe) with you, and claiming for the refund. Nothing that you have consumed such as hotel stays, meals, petrol/diesel, train, plane or bus fares, car rentals, etc can be reclaimed. Now maybe you can see why auto fuels such as petrol and diesel are so expensive over here. The base cost for refined fuel is higher than the US but not hugely. Whack on VAT on the delivery. Then most of the original price again in excise tax. Then, guess what? VAT of 17.5% on the whole lot. I'll be filling up this weekend at probably £1.24 a litre. Approximately 4 to a US gallon makes £4.96 a gallon, say $7.69 a gallon. 50 litres to fill my car is over £60 a go now.

Posted by
24 posts

Nigel... Wow. VAT at 20%? Thanks for the absolutely spot-on information, especially this: "Nothing that you have consumed such as hotel stays, meals, petrol/diesel, train, plane or bus fares, car rentals, etc can be reclaimed." That simple summary statement should be in all US guidebooks... it clarifies the original question like nothing else. So, to exist in the UK one must eat only cold food, drive nowhere, and if one purchases anything, immediately take it outside and shake it about until the VAT falls off it...

Posted by
2876 posts

To complicate things further, each European country sets minimum amounts for VAT refunds. For example, in France you have to spend at least 175 euros in a single store on a single day to qualify for a VAT refund. And you have to get an "export form" signed and stamped before you leave the store.

Posted by
32929 posts

VAT stands for Value Added Tax. So if the seller of a something has improved the something since they bought it, and the seller of the something has sufficient sales to qualify, at least in the UK, VAT is due. So, the importer of oil sells a portion of the load to a plastics manufacturer he charges VAT because it is improving the load by selling it in manageable portions. The plastic person converts it to thread and sells the thread to a seat manufacturer, and pays VAT on the amount he gets for the thread, but deducts from the return the VAT he paid for the oil - in other words, the buyer pays the full VAT to the seller, and the seller files and pays the output VAT minus any input VAT paid in order to improve the something. So to continue the story the same thing happens when the thread turns into a seat cover, that goes into a seat assembly and then it becomes a car. So who's the only one who pays the full 17.5% VAT? You the buyer, but in Europe it is generally shown included in the final price. Exceptions? Of course there are exceptions. If you go into a Costco or other predominantly wholesale store prices are shown "ex-VAT" or plus VAT. Again, all examples are UK because I know the details of UK law on this. The rest of Europe varies both in percents and exemptions. Exempt retail products : childrens clothing, raw food (but not processed), cold takeaway meals (but not hot takeaways)(so a cold sandwich no VAT, a hot dog you pay VAT) (any meal eaten in, even if not sitting attracts VAT), and books (but magazines do attract VAT). Is your head swimming yet? .... to be continued ......

Posted by
32929 posts

... part 2 ..... Certain things attract much smaller rates of VAT, such as cars, houses, fuel oil (domestic use not transportation) and jet fuel. So, to specifically answer OP's question, yes (but not cold takeaways) and yes. Oh yes, France and other countries threw a wild card earlier this year and lowered VAT on many things including meals to stimulate their economy. UK goes up to 20% next month. Ireland is redoing their budget right now. Don't know yet what will happen to theirs.

Posted by
332 posts

Take care in checking hotel prices online. Some sites include VAT in the first quoted price, others do not.

Posted by
32929 posts

Thanks Anthony. Chip, you raise a seriously valid point. Some major hotel chains, HI being one, generally include taxes in the quoted price (throughout Europe) BUT in many locations in business areas and around airports where the quotes often don't include it. Sometimes in a table of offers some will and some won't. I asked HI why that was when they introduced and the response was (astonishingly to me) was that US businesspersons are used to having sales tax on top so wanted the VAT added after the offer was accepted. On those websites you don't see the final price until when you are supplying the card details. Shameful - and completely deceptive.