Israeli startup Refundit, which is developing a VAT reclaim service for travelers via an app, has raised $10 million in a round led by Amadeus Ventures, the investment arm of Spanish travel technology company Amadeus, with the participation of Portuguese state-owned venture capital firm Portugal Ventures and investors from the company's seed round.
Refundit was founded in 2017 by Uri Levine, a co-founder of navigation app Waze, and Ziv Tirosh, co-founder and former CEO of bio-agritech company Stockton. Up to now, the company had raised $2.5 million in seed investment from private investors.
Refundit's solution, currently being piloted in Belgium, is designed to enable travelers to bypass queues to submit VAT reclaim applications at airports in the EU. To reclaim VAT via the Refundit mobile app, non-EU tourists need to take a photo of their receipts, boarding pass, and passport, and then digitally apply for their VAT refund. Tax authorities from the relevant country will review the requests digitally and send a digital confirmation to the traveler.
Refundit says that the core innovation that sets it apart from its competitors is the end-to-end digitized process for both the traveler and tax authorities. Refundit charges travelers a 9% commission for using its service. Its focus on Europe is because of the high rates of VAT there, ranging from 17% to 27%, and because 90% of available VAT rebates in the EU, amounting to some €23 billion annually, goes unclaimed, either because travelers are unaware of their rights or because of the sometimes lengthy procedure involved at airports.
"The existing VAT reclaim process is cumbersome and inefficient for all. By offering its innovative end-to-end digital solution, Refundit creates real value for all stakeholders. Our solution benefits everyone: the tourist, the retailer, the tax authorities and the country’s economy by making shopping even more appealing," Tirosh said.
Refundit employs fifteen people at its offices in Tel Aviv and in Belgium. It won the 2019 United Nations World Tourism Organization (UNWTO) Travel-Tech Startup competition, which attracted 2,700 startups from 132 countries.
Published by Globes, Israel business news - en.globes.co.il - on November 14, 2019
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