A holiday in Samnaun is anything but taxing

Shop and ski in tax-free Samnaun swissinfo.ch

Samnaun is the only resort in the Alps where holidaymakers can take a break from the strains of skiing to fill their shopping bags with duty-free goods.

It is one of a handful of villages in a remote valley bordering Austria which benefit from a unique status that has made them the envy of other high-altitude destinations.

The resort is linked with the neighbouring Austrian resort of Ischgl, and together they boast the largest ski area in the eastern Alps – the Silvretta Arena.

Visitors have around 200 kilometres of groomed slopes at their ski tips, with pistes located between a lofty 1,800 and 2,900 metres above sea level.

But despite its embarrassment of skiing riches, Samnaun generates roughly two-thirds of its income from duty-free sales.

“Duty free shopping is very important for Samnaun,” says Hubert Zegg, who runs four duty-free shops in Samnaun under the name “Zegg Shopping World”. His brothers and sisters run several others.

Family affair

Those not controlled by the Zegg family are owned by Samnaun’s other prominent clan, the Hangls.

It is a two-family town where the Zeggs and Hangls have built their fortunes on duty-free shopping.

In fact, there is barely a building or hotel in the village not bearing a “duty-free” sign.

And if visitors somehow manage to miss the countless signs on their way into Samnaun, they are promptly reminded of the village’s main attraction when they receive a shopping discount card as they check into their hotel.

In Samnaun, “après ski” takes on a whole new meaning. Skiers and bargain hunters load up their cars with discounted perfumes, Swiss watches and alcohol and top up their tanks with tax-free petrol.

“Thanks to duty-free shopping, we have been able to construct our hotels and develop the resort. Without duty free shopping we would have no money,” says Zegg.

Tax-free goods

His son Olivier, who runs one of the Zegg family shops, says his goods are at least 15 per cent cheaper than in shops in Switzerland or neighbouring Austria or Germany.

The average price of goods in Samnaun is between 20 and 30 per cent lower, and the tempting prices prove quite an attraction.

One regular customer at Zegg Shopping World drives six hours each way from the Austrian city of Graz just to do his shopping in Samnaun.

As far as the Federal Customs Office is concerned, Samnaun is located outside Switzerland’s borders and therefore value added tax is not applied to most goods.

Before a narrow road was blasted through the steep mountainsides connecting Samnaun with the rest of Switzerland in 1912, it was easier for the people of Samnaun to trade with Austria – or to smuggle goods across the border.

As a result, the Swiss government granted the village the special tax-free status in the 19th century.

Local dialect

According to Arthur Jenal, a teacher and local historian, Samnaun’s close contacts with Austria and southern Germany explain why the local German dialect spoken in the village has been influenced by the variant of German found in Bavaria and Tyrol.

But speaking at the local history museum, which sees far fewer visitors than the village’s duty-free shops, Jenal says the time has come for the resort to put less emphasis on duty-free shopping.

“There are better reasons to come to Samnaun than for duty-free shopping,” he says. “We have a wonderful ski region, wonderful nature and wonderful people. I hope that one day duty-free shopping is no longer important for us.”

Hubert Zegg does not share his opinion. He says Samnaun’s duty-free status has made Samnaun what it is today – a wealthy village which has created good jobs for the people who live there.

This is in stark contrast to many Swiss alpine villages, which depend on government handouts to survive and are fighting to stop their young people from moving away to the cities.

For this reason, Zegg believes it is in the government’s interest to allow Samnaun to keep its status.

swissinfo, Dale Bechtel

Key facts

Population – 800.
31 hotels, many boast duty-free shops.
Samnaun and Austria’s Ischgl together form largest ski region in eastern Alps.

In brief

Samnaun is the largest of five villages in the valley. All are duty-free.

The Swiss government granted Samnaun duty-free status in 1892, citing a lack of a direct road link from the valley to the rest of Switzerland. A road was finally built in 1912, but it is often closed in winter due to the danger of avalanches.

Samnaun was known as a haven for smugglers up to the end of the Second World War, from which point it began developing its reputation for duty-free shopping.

Today, it specialises in luxury items and petrol.