• Mon
  • Sep 22, 2014
  • Updated: 4:28am

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
POLITICS

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.

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This article is now closed to comments

zhuhaidj
What a complex place, the "one country" is. As an Aussie, I pay nothing to enter Hong Kong, feel welcomed, but have to buy a visa to enter the mainland. I've never been able to figure out the logic in that!
sipsip1238
I don't understand why people would oppose to the 100HKD tax if they want the best for HK.
Given that any visitor whether by land/air/water will now be paying a tax, the revenue can be used to help HK build better facilities, and prevent people who are just crossing to and back to smuggle products in and out of Hong Kong.
And if there are people desperate enough to pay more for HK products, why aren't we cashing in more for it, if our finance minister is so worried about the piggy bank going empty, isn't this one method to fill it up a bit more for a rainy day.
In most countries, you already have to pay a tax to enter or leave, if people are complaining why people need to pay to enter, then charge them when they leave.
I seriously question anyone with enough sincerity to actually visit our country if they aren't even willing to pay 100HKD.
nicolas
it's easy... just cancel multiple entry permit for the mainlander and it solved this argument...
artdig18
As these tourist brings more $$ to HK we should first improve the facility we have here and to facilitate border crossing and then charge a small fee for the improvements .
We also need more tourist attractions ... I look upon Singapore's Marina Sands and think why doesn't HK have anything like it ... we have few mundane buildings in TST that looks like no money was spent on design ... the new passenger terminal at Kai Tak is abysmal as well.
Giwaffe
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.
timothy.hill@hoganlovells.com
Why do you describe People Power as a democratic party - their behaviour is quite the opposite, more like that of a kindergarten bully.
Shadow
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.
shuike
I am a genuine traveller & crosses the borders twice daily to manage my business in Shenzhen. There are many like me. I pay taxes in both HKG & China (just incase you'd ask). Moreover, if China retaliates & imposes a Rmb100 tax on out/inbound travellers, then I have to shell out almost HK$450/daily just to cross the border. That's too high a price to do legitimate business. So these are the people most harmed by your so called suggestion. For the parrallel traders, they just add the expense onto the product. The mainlanders are rich enough to afford a few bucks extra. Have you done your maths when you wrote your comment?
A Hong Konger
There can be exemption for individuals who can prove they have legitimate reasons to cross the border, furthermore, like the airport departure tax, those crossing the border within 24 hour could be exempt from the proposed tax. But these obvious provisos aside, perhaps you could consider the millions of HK people who's quality of life suffers from the influx of mainlanders, rather than the handful of people like you who are interested in lining their pockets.
Stephan
Hong Kong, Asia's Kindergarten!! This is another good example!

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