Monday, December 6, 2010

Ireland Traveller Alert: Scam, Scam, Scamity Scam

So, if you find yourself going to Ireland...

Most of the stuff you'll buy will include a charge for VAT (Value Added Tax).

Shops (generally those that cater to tourists) will ask if you're a tourist and would like them to remove the VAT at the point of sale.  They'll tell you that you just have to drop off a form (printed on a second register receipt) at the airport and all will be well.

Yeah, what they don't tell you is that they're not taking off ALL the VAT -- because you're not dealing with the government but a private operation in the Tax Free Refund business, which charges an administrative fee (in my case 42% of the VAT) so they're really only taking off just over half of the VAT.

The fine print (about which you won't learn until you hit the airport) is that if you're not immediately departing the EU (as I was not), you can't turn in the form at the airport.  Instead, you've got to get the damn thing officially signed (by a customs agent, notary, or police officer) in your home country before mailing it back (at your expense).  If you don't, your credit card will be backcharged the entire amount of the VAT.

In other words -- unless you get the form officially approved, you'll end up paying the VAT and the administrative fee.  Lovely. 

That's not the scam, though.  The scam is from some bastards called FeXco, who claim to make your Tax Free Shopping easier with something called the Horizon card.  The idea is simple enough -- rather than collecting all those damn VAT receipts, you get a Horizon card the first time you buy something, and then they scan the card at every other shop, keeping track of all your VAT.  Same deal -- turn it in at the airport.  Same not telling you that you can't turn it in at the airport if you're not leaving the EU.  But, hey, no problem, when you get back to your home country, you can just log on to the internet, register your card, print out a pdf, get the form signed (notarized or signed by a cop) and send it back to them.  And if you don't do it within 60 days of leaving the EU, they, too, will backcharge your card the VAT.  Plus an administrative fee for the trouble.

OK, here's where the Horizon card is a scam:

If you register your card on the internet, they never send you the pdf form.

I shit you not, people.  I registered my card, and their website says that after you do that, "You will then be e-mailed a PDF Transaction Form, containing details of Tax Free purchases."  Three days pass:  no form.  I emailed them, noting that I was coming up on my 60-days-after-leaving-the-EU deadline, so I needed the damn form.  That was November 24.  Still no form (or any correspondence at all).

Here's another reason why the Horizon card is a scam:

When I told their agents at Dublin airport that I didn't want to go to the expense of paying a notary to approve a refund that cost less than the cost of the notary, they told me that the form could be approved by any lawyer.

This would be convenient as I know lots of lawyers.  Of course, their website is pretty clear that this is bullshit, and that they will only accept form approved by a notary, justice of the peace, or police officer.

Bottom line is that the bastards will lie to you to get you to leave the country without doing anything to process the transaction and then refuse to send you the form to enable you to send it back once you've left the country.

Now, I actually had two VAT-refund transactions when in Ireland -- one without the Horizon card and one with.  I had planned to print out the damn Horizon form and then take that, and my other tax free receipt, to a police officer to get them both signed.  While waiting for the Horizon form that never came, I missed the deadline on the other receipt, resulting in a $16 backcharge to my credit card.  I'm actually OK with this, as it was my own stupid fault for not processing that one separately.  So far, I have not been backcharged on the Horizon card transaction yet.  I just sent them a second email indicating that I will dispute any such charge since the weasels didn't send me the form in time to timely complete and return it -- and I therefore consider the matter closed.

And I am now doing the internet equivalent of shouting from the rooftops that the bastards at FeXco Tax Free and their Horizon card scheme is -- at best -- run in a wholly incompetent manner and -- at worst -- a great big rip-off-the-tourists scam.


Anonymous said...

Thanks for this post. The Horizon card sounded to good to be true

Anonymous said...

How much was the administrative fee?

nzforme said...

It was 42% of the total VAT amount. I don't have my receipts easily available, so can't say what it was exactly.

I should add, though, that it turns out that the $16 back-charged to my account WAS from the Horizon people -- they charged it 60 days after the purchase, not 60 days after I left the EU. I had my credit card reverse it. On about my third email to the Horizon people, they finally sent me the damn form, and once I sent it back, they did not bother me again for the $16.

No explanation (or apology) for any of the rest of it.

Anonymous said...

Okay thanks. A woman at a store swiped one of the cards and handed it to me with my purchase without asking me if I wanted it or explaining what it is. I wanted to make sure I wasn't going to get charged $100 or something for not returning it.

Anonymous said...

I've heard nothing but good about the Horizon card. Are you the only one that had a problem. I don't know whether to use it or not when I go next month.

Anonymous said...

Thank you!!! for taking the trouble to write about this scam, I - and many others - would have fallen for it. I appreciate your saving us the time and trouble.

Anonymous said...

I agree its a bit a scam. You have to register the card, claim refund online very intrusive, then get home and get a Notary then mail back to Ireland. All this to get a portion of your VAT back. If you don't follow all the steps you lose the refund plus pay an extra fee. Nice!! Unless its a big purchase and you know you will have time at airport to fill out all paperwork its just not worth the hassle.

Anonymous said...

Agree that using this card is a complete ripoff. All rules must be followed exactly or they issue no refund. Also, the "Adminstrative Fee" they charge for this deal is 45% of the VAT amount. Will NEVER use them again.

Anonymous said...

Totally agree! Excessive admin fee that was not disclosed clearly. Not everyone accepts so have to keep receipts anyway. Would not recommend Horizon card. However....Ireland is an amazing vacation!

GoNandini said...

Thanks for making us aware about this scam. Thanks for sharing this...,

Also check : Travel Taughts