Mainland takes a 20pc bite out of travellers' Apples

PUBLISHED : Wednesday, 20 October, 2010, 12:00am
UPDATED : Wednesday, 20 October, 2010, 12:00am

Have an iPhone or iPad and plan to take it to the mainland? Prepare to be taxed.

Customs officials across the border have been ordered to step up a crackdown on the smuggling of Apple devices, and people carrying iPhones or iPads are being slapped with an import duty even if they can prove they are for personal use.

Taking large quantities of electronic goods into the mainland has always been banned or subjected to heavy taxation. But the latest crackdown has extended the tax to individual users.

In recent weeks, many people have reported being stopped at border checkpoints by mainland customs officers for carrying iPhones or iPads. Some said they had to pay customs duty even though they were carrying just one device at the time and had evidence to prove it was not for resale.

A Shenzhen customs official, who refused to be named, confirmed yesterday that bringing just one iPhone or iPad into the mainland would incur tax. 'It's a common misconception that you can get a tax exemption if the device you are carrying is for self-use,' she said. 'In fact, iPhones and iPads are among the 20 products that are excluded from tax exemption. You need to make a declaration and pay the tax even if you are bringing in only one [device].'

In most cases, the iPhones and iPads being taxed are in boxes and unused. But an American-Chinese man said he was charged duty by mainland customs officials at the Lowu border recently for an iPad he had been using for months.

'I showed them the documents and photos I stored in the iPad but they wouldn't listen. In the end I had to pay 1,000 yuan [HK$1,165] before I could leave,' the man told a mainland newspaper, the National Business Daily.

Similar cases have been reported by other mainland newspapers in the past few days.

The General Administration of Customs in Beijing issued a directive on August 19, clarifying regulations on what visitors and mainland residents can bring into the country without paying duty.

It said mainland residents could bring in tax-free an overseas purchase valued at up to 5,000 yuan. The limit for visitors was 2,000 yuan for items they did not plan to take home.

While Apple products were not directly mentioned in the directive, the Shenzhen customs officer said it was aimed at addressing rampant smuggling of iPhones and iPads from Hong Kong and Macau into the mainland.

'We started to notice a lot of people carrying [boxed] iPads and iPhones across the border since April,' she said. The number surged in July when iPhones and iPads went on sale in Hong Kong, she said. In Zhuhai, customs officers have found and taxed more than 400 iPhones and nearly 100 iPads carried by individual travellers this month alone, local media reported.

iPhones and iPads are in short supply on the mainland and prices are higher than in Hong Kong.

Paul Jiang, 28, from Beijing, who came to Hong Kong to buy an iPad, said a 64 gigabyte version cost about 6,500 yuan (HK$7,570) at home and was only HK$6,500 in Hong Kong.

The price difference has lured visitors to Hong Kong to buy Apple products and take them back to the mainland for sale or as gifts. Given the huge volume of traffic at the border, it is difficult for customs officials to check every passenger.

Most people are not aware of the latest crackdown and many said they had no problem crossing the border with an iPhone in their hands. An iPhone user from Indonesia said yesterday he did not know of the duty.

Kurt Lo King-yau, manager of a shop selling parallel iPhone and iPad imports in Mong Kok, said business could be affected, as 40 per cent of his customers were from the mainland, but it was too early to tell.

Comdex Computer manager Kong Hong was not worried. 'Some mainlanders bought 10 iPads at one time from us... They would have known ways to sneak past customs.'

Yardley Luk Wai-kit, 25, who works in the advertising industry and owns an iPad and iPhone 4, said he was outraged when he saw news on the internet of the duty.

'My iPad is only for personal use. I am not importing any iPad. Why do the Chinese customs impose tax on me? It just does not make sense. It is no different from provincial officials collecting heavy taxes from poor people in the past, or triad members collecting protection fees,' he said.

Additional reporting by Amy Nip

Pain in the hip pocket

The number of iPads and iPhones taxed at the Zhuhai border in just one day: 500