Chinese resort to offer tax-free tourist shopping
Overseas tourists visiting Hainan Province will be able to shop tax-free from next year.
The plan, which will apply to foreign travelers and those from Hong Kong, Macau and Taiwan, is a central government initiative aimed at building the southern Chinese island into an international tourist destination by 2020.
Overseas tourists will be able to get a rebate of 11 percent on purchases in designated shops in the province from January 1 if they spend more than 800 yuan (US$120) and stay in China for less than 183 days.
Items in 21 categories, including clothes, shoes, cosmetics, watches, jewelry, electronic devices and sports gear are all included in the plan. But items such as food, cigarettes, alcohol, cars and motorcycles are excluded.
Lu Yong, vice director of Hainan's finance department, said: "The rebate scheme is aimed at boosting overseas tourist arrivals and spending so as to build Hainan into an international tourist island."
Lu did not give the number of shops involved but said that some malls were already putting up Chinese and English signs advertising the rebate.
Zheng Jianxin, deputy director of the taxation department under the Ministry of Finance, said the rebate scheme would help improve Hainan's reputation as an international tourist destination.
Experience gained from running the scheme would also be used to improve the country's tax rebate system, Zheng said.
Eligible items need to be unused and be bought within 90 days of travelers leaving China and applications for the rebate made at Customs when travelers leave the country.
The rebate policy for overseas travelers is considered a prelude to a broader one that will eventually allow tax refunds for the millions of domestic tourists who visit the island.
"Hainan should allow, as soon as possible, domestic visitors and locals to buy duty-free goods," Chi Fulin, executive director of the Haikou-based China Institute for Reform and Development, said yesterday.
Chinese consumers may be able to enjoy tax refunds up to two times every year and get their sales tax returned if they spend up to 5,000 yuan on each occasion, yesterday's Oriental Morning Post quoted unnamed insiders as saying.
By the third quarter of this year, about 15.72 million tourists had visited the island. More than 97 percent, or 15.31 million, were from other Chinese provinces while 410,000 were overseas tourists, Wang Keqiang, deputy chief of Hainan's commerce department, told the China News Service.
The provincial government aims to increase its total tourism revenue to 124 billion yuan by 2020 from 21 billion yuan in 2009.
Currently, 20 percent of that revenue comes from shopping and that figure, hopefully, can double to 40 percent after the introduction of the rebate policy, Wang said.
China has been aiming to transform its economy to make it more consumer driven and consumption is outlined as one of the key factors targeted for growth under China's new Five-Year Plan that begins in 2011.
Chinese tourists have long favored places such as Hong Kong as a shopping destination because sales tax isn't levied there. In 2009, 70 percent, or HK$83 billion (US$10.7 billion), of spending by all visitors to the special administrative region came from Chinese mainland tourists, according to the Hong Kong Tourism Board.
In early January, the Chinese government announced plans to build Hainan into a top international tourist destination within the decade.
As part of that goal, Hainan added five more countries to its visa-free list in August, allowing tourist groups from 26 countries to enjoy visa-free access for up to 15 days.
The plan, which will apply to foreign travelers and those from Hong Kong, Macau and Taiwan, is a central government initiative aimed at building the southern Chinese island into an international tourist destination by 2020.
Overseas tourists will be able to get a rebate of 11 percent on purchases in designated shops in the province from January 1 if they spend more than 800 yuan (US$120) and stay in China for less than 183 days.
Items in 21 categories, including clothes, shoes, cosmetics, watches, jewelry, electronic devices and sports gear are all included in the plan. But items such as food, cigarettes, alcohol, cars and motorcycles are excluded.
Lu Yong, vice director of Hainan's finance department, said: "The rebate scheme is aimed at boosting overseas tourist arrivals and spending so as to build Hainan into an international tourist island."
Lu did not give the number of shops involved but said that some malls were already putting up Chinese and English signs advertising the rebate.
Zheng Jianxin, deputy director of the taxation department under the Ministry of Finance, said the rebate scheme would help improve Hainan's reputation as an international tourist destination.
Experience gained from running the scheme would also be used to improve the country's tax rebate system, Zheng said.
Eligible items need to be unused and be bought within 90 days of travelers leaving China and applications for the rebate made at Customs when travelers leave the country.
The rebate policy for overseas travelers is considered a prelude to a broader one that will eventually allow tax refunds for the millions of domestic tourists who visit the island.
"Hainan should allow, as soon as possible, domestic visitors and locals to buy duty-free goods," Chi Fulin, executive director of the Haikou-based China Institute for Reform and Development, said yesterday.
Chinese consumers may be able to enjoy tax refunds up to two times every year and get their sales tax returned if they spend up to 5,000 yuan on each occasion, yesterday's Oriental Morning Post quoted unnamed insiders as saying.
By the third quarter of this year, about 15.72 million tourists had visited the island. More than 97 percent, or 15.31 million, were from other Chinese provinces while 410,000 were overseas tourists, Wang Keqiang, deputy chief of Hainan's commerce department, told the China News Service.
The provincial government aims to increase its total tourism revenue to 124 billion yuan by 2020 from 21 billion yuan in 2009.
Currently, 20 percent of that revenue comes from shopping and that figure, hopefully, can double to 40 percent after the introduction of the rebate policy, Wang said.
China has been aiming to transform its economy to make it more consumer driven and consumption is outlined as one of the key factors targeted for growth under China's new Five-Year Plan that begins in 2011.
Chinese tourists have long favored places such as Hong Kong as a shopping destination because sales tax isn't levied there. In 2009, 70 percent, or HK$83 billion (US$10.7 billion), of spending by all visitors to the special administrative region came from Chinese mainland tourists, according to the Hong Kong Tourism Board.
In early January, the Chinese government announced plans to build Hainan into a top international tourist destination within the decade.
As part of that goal, Hainan added five more countries to its visa-free list in August, allowing tourist groups from 26 countries to enjoy visa-free access for up to 15 days.
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