Luxury shoppers are watching fashion tariffs 2025 closely. In April 2025 the US announced a baseline 10% tariff on imports (with "worst offenders" like the EU hit at 20%) (The Guardian). European luxury houses – which account for ~70% of global luxury market value – have warned they will pass these costs to consumers. Hermès and Kering have signalled they'll "increase our prices accordingly" if duties bite (Reuters), and analysts forecast roughly a 5% hike in US luxury prices (BSPK). In fact, many brands have already raised tag prices in early 2025. After years of aggressive "greedflation" (Chanel's classic flap bag has more than tripled in price since 2010), shoppers are feeling pinched – meaning further designer price trends in 2025 may be modest. A weaker pound or euro may cushion UK/EU buyers somewhat, but global inflation still leaves tag prices high.

Travel Shopping in Paris, Milan, Dubai & New York

Despite tariffs, travel can still save on fashion. Europe's luxury capitals remain tempting. In France and Italy the standard VAT is ~20–22%, but non-EU visitors (including UK residents) can typically reclaim around 10–15% via tax refunds (Rick Steves). Global Blue data suggest every 10% US tariff could trigger a ~20% jump in American tax-free spending in Europe (NSS Magazine). In practical terms: Americans are finding shopping in Paris or Milan more attractive, as "relatively lower European prices (and VAT refunds)" make up for higher US tags. Italian luxury hubs (Milan, Rome) and Paris's designer boulevards all process VAT refunds on spot.

Paris & Milan: Bid for sample sales and Jan/Jul end-of-season sales. Boutiques offer tax-free forms (min. spend ~€100) so you can reclaim roughly 12–15% when you fly home.

Dubai: No income tax and only 5% VAT means built-in savings. Shop during Dubai Shopping Festival (Dec–Jan) or mid-year sales for extra markdowns on jewellery and high-end apparel.

New York: US has no VAT, but state sales tax (e.g. ~8.9% NYC) applies above local exemptions (most clothes <$110 are tax-free in NY). Note the US personal duty-free allowance: returning US residents get up to $800 of imports duty-free (CBP), so budget accordingly.

VAT Refunds, Duty-Free & Seasonal Timing

Maximise your budget with timing and tax tips. The EU's common VAT (20–25%) and minimum spend (often €50–€100 per receipt) mean big savings on big-ticket items. Major sales are January and July (spring/winter collections), with occasional "Black Friday" deals in November even in Europe. Plan travel outside high season to snag off-peak hotel rates and fewer crowds.

Duty-free limits: Remember allowances on return. In the UK, any traveller can bring up to £390 of goods home tax-free (GOV.UK); beyond that VAT (20%) and duties kick in. In the US, the personal exemption is $800 per person over 31 days. Stay under these limits or declare any excess to avoid surprises.

By mixing savvy travel plans (VAT refunds, seasonal sales) with awareness of tariffs and designer price trends, luxury shoppers can still stretch their budgets. For deeper dives, see our VAT Refund Calculator and Shopping Guides to every city's best boutiques.