Alcohol: cheap and expensive. Andorra: 4.5% VAT with no excises
Why do more than 5 million Spaniards and French come to Andorra every year? One of the main reasons — to buy alcohol, as it’s the cheapest on the market in Western Europe.
Andorra is not part of the European Union, therefore, the country’s trade policy is not affected by the strict European regulations of the alcohol market. In addition, Andorra today has the lowest VAT rate in Europe, which is fixed for all types of goods (including alcohol) at 4.5%. Andorra has also no excise on alcohol trade, which is actively practiced by the pan‑European taxation on alcohol policy.
Shops in Andorra sell all kinds of alcohol, including exquisite “museum” types of cognac and wines at low prices (interesting for collectors), as well as cheap alcohol for every day consumption.
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