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HomeNEWSDuty-free pricing structure under suspicion

Duty-free pricing structure under suspicion

A survey of 33 duty-free products by Consumer NZ has found that only 10 of these were sold at lower prices than mainstream retailers. In fact, some items were more expensive at duty free 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,” Consumer NZ chief executive Sue Chetwin advised consumers.

Consumer NZ’s survey found that all seven of the confectionary products it looked at were cheaper at supermarkets or big-box retailers than at airport duty free chains Aelia Duty Free, JR Duty Free and The Loop Duty Free. 

It reported that spirits were consistently better-priced than at mainstream retailers, but Chetwin added a corollary, saying that since 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.

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,” Chetwin says.

Consumer NZ’s survey found duty-free stores did not alert customers as to which goods were not subject to duty free, which goes against the Commerce Commission’s recommendations.

The watchdog organisation is lodging a complaint with the commission in response to the findings from its survey.

“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,” Chetwin says

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