The Merchandise Passport: A Tool for VAT Avoidance

The Merchandise Passport, a.k.a. ATA Carnet, waives payment of import duty and tax (VAT, GST) on temporarily imported goods. This includes hand-carried items that business travelers may put in checked luggage or carry on board a flight.

For a business traveler hand-carrying a $21,000 medical device to the U.K. that's a $4,500 savings.

Even if VAT recovery is available and utilized (thus reducing these savings), using a Merchandise Passport means the value added taxes are never paid in the first place. So there is time and expense saved on VAT recovery as well.

Additionally, VAT recovery doesn't reclaim the import duties so that's not an expense that can be recovered without utilizing some form of temporary import customs clearance like an ATA Carnet.