Military exchanges operate abroad tax-free and subsidized, fueling black markets

Evidence

These Walmart-like shopping malls are run by congressionally mandated government resale entities that enjoy retail rights on bases worldwide. In exchange for agreeing to return a portion of “reasonable earnings” to fund sports, libraries, and other recreational facilities and programs on bases, the Army and Air Force Exchange Service (AAFES) and its Navy and Marine counterparts enjoy buildings and land free of charge, free utilities, and free transportation of goods to overseas locations. They also operate tax free, which partly explains why they have generated thriving black markets and “PX economies” for decades. — David Vine, Base Nation_ How U.S. Military Bases…, 624