• Wed
  • Dec 24, 2014
  • Updated: 11:29pm

Parallel trading

The influx of parallel traders who buy their stock tax-free in Hong Kong to resell it in mainland China at a profit is causing growing unrest. Residents of Sheung Shui, a town close to China's border, say the increase in parallel importers has pushed up retail prices and causes a general nuisance. Importers argue that their trade benefits the Hong Kong economy.

NewsHong Kong

Democratic groups propose arrival tax of up to HK$100 to curb mainland visitors

Suggestion by democratic groups to charge visitors up to HK$100 is rejected by the tourism trade and labelled ‘brutal’ by one lawmaker

PUBLISHED : Tuesday, 11 February, 2014, 4:33am
UPDATED : Tuesday, 11 February, 2014, 10:12am

Two democratic groups have proposed slapping an arrival tax of HK$20 to HK$100 on non-Hong Kong residents who enter the city by land as a means of curbing the influx of mainland visitors.

But the idea drew a hostile reaction from the tourist industry, which said it would damage the city's image, and a Beijing-friendly lawmaker who said it was a rather a "brutal" solution.

The biggest tax, HK$100, was suggested by radical group People Power. The Democratic Party proposed HK$20 to HK$50.

Concern about Hong Kong's ability to absorb mainland tourists has risen since commerce chief Greg So Kam-leung estimated last month that tourist numbers could climb 30 per cent to 70 million a year in three years, and to 100 million in a decade.

Watch: Can residential areas in New Territories handle mainland tourists?

"We are not trying to drive all tourists away, but to control - or stabilise - the numbers of tourists," Democratic Party lawmaker Sin Chung-kai said. "Hopefully the proposed tax would discourage mainland tourists - particularly parallel-goods traders - from travelling to Hong Kong."

The party said about 20 million or 88 per cent of the 23.1 million independent travellers in 2012 entered the city by land.

People Power lawmaker Albert Chan Wai-yip said his party's more aggressive plan might stem the influx of at least 10 million mainland travellers a year who enter and leave on the same day.

When asked about Chan's proposal, Secretary for Security Lai Tung-kwok said he would not comment on it but stressed his bureau was taking steps to ease the traffic load at borders. Future plans included more checkpoints and promoting the use of automated passenger clearance.

Watch: Can Hong Kong's border checkpoints handle more tourists?

Travel Industry Council executive director Joseph Tung Yao-chung said a charge would undermine Hong Kong's image.

"I haven't heard of any places in the world that charge an arrival tax," he said, adding that the government should figure out ways to cope with the flood of tourists instead of imposing a new tax.

Ocean Park chairman Allan Zeman said: "I'm worried that this would make visitors feel unwelcome. They can go to many places in Asia and do not have to come to Hong Kong."

Federation of Trades Unions lawmaker Wong Kwok-kin said an arrival tax was a "brutal" way of dealing with the problem.

"It gives people an impression that the measure is targeting a specific group of people - mainlanders - and it is discriminative."

In 2003 the then financial secretary, Antony Leung Kam-chung, proposed a land departure tax of HK$18, but it was scrapped in the face of widespread political opposition.


For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive



This article is now closed to comments

Ok, the tax may this time have been suggested by a radical political party, but I think the proposal in itself has merit and deserves at least some thought. At the moment, all travellers using our airport must pay a few hundred dollars in airport taxes. If all cross-border travellers are charged a small tax, I don't see how it would be discriminatory. True, it may discourage some travellers but that is probably a good thing given Hong Kong's current state of affairs. A tax of say $50, is unlikely to discourage a genuine tourist who plans to stay for a day or two. It probably will, however, discourage some parallel good traders from making multiple trips everyday and clogging our streets and MTR. At the end of the day, Hong Kong cannot (and should not never aim to) impose a border tax high enough to discourage all mainland tourists. The tourism/retail industries will always vigorously object to any such tax, this is to be expected when vested interests are involved. But such a tax may really decrease the number of tourists in Hong Kong and would be a much more politically acceptable way of doing so than imposing a "hard limit" as others have suggested. Besides, isn't it time that Hong Kong as a whole benefits at least a little bit (through the tax) as opposed to only our bosses and landlords?
Everybody using our airport pays airport tax so why not a land tax. This not just for tourists but for HK residents as well as they make up the biggest group of smugglers. Make it a HK$ 500 fee instead and all HK grannie's who que up at special/APEC lanes to buy veggie in China will also not go anymore and mainlanders who just come buy soy sauce and shampoo in HK will also stop and at the same time the kids who come daily for schools will no longer come as it becomes too expensive! Those who come to buy HK$ 60,000 watches will anyway come by plane. At same time I suggest that China customs start doing its job and checks everyone who comes from HK for luxury goods and if they have any make them pay a penalty and explain where the funds come from to buy these goods (check their tax records). HK is not just a tax haven it is a haven for criminal money and money laundering. I have never seen a bank teller ask a customer where the USD 500,000 cash or even ones over HK$ 15,000,000 cash came from when they came to deposit it. Don't try that in Europe where you have an issue carrying more then Euro 10,000 in cash
This is a sound idea and should have been proposed much sooner.

There is nothing brutal or discriminatory about asking tourists to pay some small compensation for the externalities they impose upon Hong Kong residents, by overburdening public infrastructure and competing for retail space and other resources.
Are you freaking kidding me? Let's put aside how discriminating the proposal is, it would severely harm the image of Hong Kong. Is Hong Kong a tourist city or not? Is Hong Kong welcoming or not? Is Hong Kong friendly or not? If HK is to sacrifice its good reputation and qualities, it would solve the issue of overwhelming tourists soon cause NO ONE would want to visit an unfriendly town.
Besides, charging HK$100 to stop people from coming? How is it going to stop anyone? It just sends out a rude message.
Last but not least, being a colony for 100 years, Hong Kong people should at least have some empathy of being discriminated against.
John Adams
What difference does HK$100 make when one can buy a HK$60,000 Rolex watch in HK for 20% cheaper than in China ?
In fact many ( most ? ) visitors from the Mainland come here specifically to buy luxury goods and cosmetics which they take back to sell to friends.
Why else are there all the crowds in Causeway Bay ?
Has the democratic party got its head in the sand ?
damage hk image?
or just let the territory be overrun by 100 million , maybe be like macau, streets filled with humans unable to walk
yes, that will be a nice image for the world to see
left wing wackos like you add nothing but shrill to fixing a real problem
Taiwan imposed a 4000 daily upper limit to Mainland visitors, why can' Hong Kong do it ? Hong Kong is an International city, not a shopping city for China. As a resident in Northern District I am fed up with having have to wait for another train to board to avoid those "Chi-nas". People are getting aggrevated and began acting quite rude to them (myself just saying things like ****s to them).
It would be fair if anyone over 18 entering China paid RMB$50 and anyone over 18 entering Hong Kong paid HK$50. Irrelevant of who they are (Westerners, Chinese, Hong Kong Citizens etc...).
This money could then be used to improve boarder crossing points etc..
It would not be hard to collect the money as people could use Octopus or the Shenzhen counterpart to pay.
Chinese people who enter HK 2-3 times per month and Hongers entering China 2-3 times per month would not really notice the extra cost.
This however will reduce the daily trips back and fourth.
How much to charge really depends on what the purpose of the fee is. If the purpose is to discourage/reduce the number of tourists, it would seem HKD 250 to 500 would make more of an impact. If the purpose is to raise funds to improve border facilities and contribute to general revenue, then HKD 100 seems more appropriate. If the purpose is to target parallel traders, then the fee ought to be doubled or tripled for each round trip border crossing in excess of once per day.

Overall, this is a great idea to raise revenues, mitigate the strain on the local communities in Hong Kong (especially north and northwest New Territories), and reduce the load on the overloaded infrastructure.
it does not seems ugly if we call it "Boarder maintenance and improvement fee". one could see the dirty toilets at the broader even on Hong Kong side. they are so smelly that one have to control breath before entering till coming out.
Long Queues in a cramped area. and people rushing towards Automated machines and manual counters, very common scene. WHY not expand this all to a high standard control point?
Charge $50 per head to all out bounds travelers & $50 to all inbound travelers disregard of what nationality or residence status they may have, would be best idea. We must note that even Hong Kong residents should pay the same tax too, because the aim of the tax is to improve the boarder control facilities, and not to discourage genuine travelers but those who are just lingering.
Fee should be tested for a period of 6 months and if proven good then it should be relaxed on Hong Kong residents. We must not forget that we are paying airport maintenance fee of $150 for each outbound travel.



SCMP.com Account