VAT Refund - Italy Hotels
 

Can Americans obtain VAT refunds from hotel stays in Italy? Anyone have advice on the process? Mille Grazie.

no, I don't think there is any country in the world that refunds VAT for hotel stays, if there is a VAT on the room. It would be kind of silly since the main purpose of hotels is for travelers.

VAT refunds are for goods taken out of the country. A hotel stay is neither.

VAT only applies to goods that will be transported out of the EU for use. You are not even supposed to use any of the items you are applying for VAT refund for. In my experience, Italy is stricter than France on the no-use issue. When you but goods in Italy, the bag will be sealed and if Customs requests to see the item they'll expect to see the seal in place or they will void the VAT refund request.

Just FYI, I have received VAT-like refund for hotels from Canada. Not sure if still in effect as last trip there was 2003.

I got VAT refund for Canadians hotels twice, last time in 2004. Each time mailed the form from home - they've requested a post-mark from out-of-country (I live in US).

Hello, Coco ;)

Canada continues to offer refunds of its VAT (the Goods & Services Tax) on hotel rooms for foreign visitors. As far as I know, it is the only country to do do so. It makes no sense from a tax policy perspective. But I guess the greater public policy driver is the belief by the Federal Government that Canada is such an unattractive destination for foreign visitors that this tax subsidy is necessary.

Canada doesn't operate VAT.

There's a dogma in the theory behind VAT (predictably, a tax invented by French polytechniciens, and now a tax with near-uniform rules throughout the EU) that tax should be refunded on goods or services that leave the country. It's got nothing to do with encouraging tourists to buy things, but a lot to do with ensuring tax gathering doesn't inflate export prices.

Incidentally, all VAT-registered companies get the VAT on hotel rooms their employees stay in on business refunded. Under certain, highly complex, circumstances, foreign businesses can also get VAT refunded on hotel rooms in the EU, though this needs to be set up in advance and the only English-speaking official advisors about this are some nice ladies in Northern Ireland.

The URL for this obscure rule was put on this board about three years ago, though I can't find it. Happy hunting.

Thanks. You've answered my question. A tax described as a 10%VAT on a hotel room is really just the standard hotel tax not a true VAT.

Flanner, the Canadian government disagrees with you. From the Department of Finance,

Canada's goods and services tax is a form of VAT. It applies at each stage of the production and distribution chain. To ensure that tax applies only once to the final consideration paid for a consumer expenditure, registered businesses are entitled to credits for tax paid on inputs into making taxable supplies.

http://www.fin.gc.ca/gloss/gloss-u-z_e.html#vat