I guess duty-free stores were a thing decades ago when international trade was actually constrained by duties. Right now free trade is the default (or was, until Trump)
Many countries apply VAT for products bought in their domain, but they also have thresholds for products bought overseas and taken into the country by their residents who were travelling (otherwise I imagine even a bracelet bought at a beach in Bali would have to be declared and taxed, and there'd be long queues at customs). For things like cigarettes and alcohol they have a quantity limit, beyond which taxes do apply.
A Rolex certainly goes beyond the threshold in many countries, but maybe the thought is the buyer might be willing to risk "smuggling" it in.
