Affluent U.S. consumers are increasingly booking trips to Europe in search of tax savings on high-end purchases, as new tariffs make luxury imports significantly more expensive at home.
Swiss watches in the spotlight
Jamie, a 42-year-old New Yorker, and her husband plan to travel to Switzerland this December for a ski vacation — but skiing is not the only draw. The couple intend to buy a Patek Philippe Nautilus in Geneva, with a budget of $50,000 to $75,000, hoping to avoid the 39% U.S. tariff imposed on Swiss goods earlier this month.
“It was a motivator and added bonus,” Jamie said, noting the trip had long been on their minds. If successful, the couple could save tens of thousands of dollars by purchasing directly in Switzerland rather than through U.S. retailers.
Switzerland, home to prestigious watchmakers such as Rolex, Piaget and Audemars Piguet, has quickly become the top destination for tariff-conscious luxury travelers, according to travel advisor Erica Jackowitz. France and Italy — home to fashion powerhouses like Hermès and Prada — are also emerging hot spots.
A surge in tariff-driven tourism
The U.S. imposed a 15% tariff on most European Union goods in August, while Swiss imports face a much steeper 39% levy. Travel specialists say this policy shift has sharply increased demand for shopping-centric itineraries.
“People realized after the Taylor Swift tours in Europe last year that traveling abroad can actually be cheaper,” said Jack Ezon, managing partner at Embark Beyond. He reported a 48% rise in shopping-focused trips among his clients compared to 2024.
Luxury watches and fashion remain the biggest attractions. For example, FlavorCloud, a cross-border logistics firm, estimates that a Rolex Lady-Datejust retailing for $11,300 in Europe would cost roughly $15,700 in the U.S. after tariffs — a $4,400 markup.
The customs hurdle
Yet trade experts caution that the strategy may not be foolproof. U.S. travelers must declare purchases upon reentry, and luxury goods are typically subject to the same tariffs, duties and taxes as imported shipments.
“There is no way around that,” said Rathna Sharad, co-founder and CEO of FlavorCloud. “A $4,000 handbag or a $10,000 watch will be assessed at the border.”
Travelers who fail to declare items risk penalties, fines, and even the loss of Global Entry privileges. While customs officers have some discretion, experts say high-value items are rarely overlooked. Each traveler is allowed an $800 duty-free exemption, with families able to pool their allowances.
VAT refunds and pricing advantages
Even with tariffs applied, buying in Europe can still be advantageous thanks to value-added tax (VAT) refunds. American shoppers are typically eligible for VAT rebates of 15% or more, depending on the country.
“VAT refunds deliver a double benefit — not only do travelers get money back, but the declared value at customs is reduced, lowering the duty owed,” Sharad explained.
Retailers provide VAT refund forms at the point of sale, and travelers must process them before departure, usually at airport refund counters. Combined with generally lower base prices overseas, the savings can be substantial.
Shopping becomes part of the experience
Travel advisors are increasingly weaving shopping into curated itineraries. Jackowitz is organizing a Paris trip that combines luxury purchases with cultural stops, such as a visit to La Galerie Dior.
For Jamie and her husband, the opportunity to secure a rare Patek Philippe watch in Geneva was as much about the experience as the savings.
“The ability to get the watch at a significant discount and enjoy the trip at the same time pushed us over the edge,” she said. “I imagine it’ll be a lot of fun.”
