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NewsHong Kong

An arrivals tax would hit locals too, says CY Leung

Government can't tax mainlanders without taxing Hongkongers, says chief executive as he rebuffs plan to charge mainlanders an entry fee

PUBLISHED : Tuesday, 11 February, 2014, 6:55pm
UPDATED : Wednesday, 12 February, 2014, 11:27am

Imposing a tax on non-Hongkongers arriving by land could prompt a tit-for-tat move by mainland authorities, Leung Chun-ying warned yesterday.

The chief executive also said the proposal, floated by politicians as a way of curbing the influx of mainland tourists, was not feasible as the government could not tax non-locals without taxing returning Hongkongers, too. He did not elaborate.

However, a member of a government committee studying population policy argued a tax could be a "smart move".

"Mainlanders and foreign visitors coming to Hong Kong have offered a bracing effect to Hong Kong's tourism and economy," Leung said.

"They have created massive job opportunities. This is why we should not be conceited before getting rich."

The idea of an arrivals tax of HK$20 to HK$100 on non-locals who enter the city by land was proposed by Democratic Party lawmaker Sin Chung-kai and two People Power lawmakers. They raised it in response to a government forecast that the city would receive 70 million visitors a year within three years.

Yesterday Leung pledged to boost the city's capacity to accommodate travellers.

Professor Paul Yip Siu-fai, a University of Hong Kong demographics expert and member of the steering committee on population policy, said the idea of a tax was worth considering until the government had increased the city's capacity.

He said it would be a "smart move" as it would help regulate the flow of day-trip visitors from the mainland - 23 million a year, Tourism Board figures show.

"We need special measures at special times," he said, "It is not a discriminatory move. It is just … to reduce their impact on the daily life of residents."

People Power lawmaker Raymond Chan Chi-chuen criticised Leung for snubbing his proposal without much discussion.

"Leung owes Hong Kong people an apology for saying that they should not be proud before getting rich," Chan said

Democratic Party lawmaker Albert Ho Chun-yan also said that Leung's remark was an "insult to Hongkongers" because the tax suggestion had nothing to do with their being proud.

Frank Pak Fu-hung, founder of bird's nest retailer Home of Swallows, worried that local retailers would be badly hit by the tax, as mainland visitors' spending accounted for about 60 to 70 percent of their sales revenue.

Additional reporting by Tanna Chong



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This article is now closed to comments

If there is indeed no discrimination, then please remove the borders away.
The suggestion of entry tax aimed to relieve the deteriorating living condition and daily life of Hongkonger impacted by parallel traders. The cancellation of daily multi entry permit is the most feasible and easy way to solve the problem. The number of visitors having genuine need to entry and exit Hong Kong is limited and can be exempted on case by case. Real visitors will not care on this administration measure.
sudo rm -f cy
Retaliatory tax or none, I have no interest in visiting PRChina anyway.
Don't be discriminatory then, tax locals, because when locals go on trips, we actually go on trips and not there to profitier.
We also don't **** all over the place, use the tax to pay for the cleanup
Even supposing it were unfeasible to impose a tax on non-locals without taxing returning Hong Kongers--which is entirely untrue--there would be no big issue since Hong Kongers could afford such a tax whereas the real targets, the non-local mainlanders, could not. Therefore, it would serve to discourage and reduce the number of incoming tourists.

A some astute commenters have noted, returning Hong Kongers would pass through e-channel or otherwise use their HKID cards. The tax would be charged on anyone who does not hold an HKID card. How unfeasible is that?
Of course they will no tax locals entering China, because the Mainland is always supposed to be helping Hong Kong right? Reducing the problems caused by excessive tourism and smuggling seems like the right thing to do.
However, obviously there is no solution that the government can accept, because this is all part of the big plan. Forced integration and then kick down the borders.....welcome to hell.
The current government seems fail to address the social problems that were brought by the less-wealthy mainlanders (e.g. traffic congestion, smuggling of milk powder, shortage of hotel supply, etc) that makes a significant portion of the incoming visitation but are not the target visitors of HK as they make little contribution to HK. His promise on solving the problems, such as improving the infrastructure, to me seems to be empty words and his advice that HongKongers should be more tolerant to the problems seems to be over-demanding when there is an easy short-term solution (i.e. arrival tax) to alleviate the problem. Of course, in the long term the tax can be scrapped.
I consider the tax should not be heavy - a symbolic tax of $100 should have served the purpose. It should be applied to all travelers around the world to avoid discrimination. The overseas travelers who are going to spend the holiday in HK are not going to be deterred by this token tax as it is just a fraction to their spending in HK. Yet, it will have a considerable psychological impact to the frequent mainland visitors.
CY is not witnessing the coaches parking in front of their home and causing severe traffic congestion everyday and he is not seeing the mainland visitors spitting and urinating in his neighborhood everyday. I would like to see the home of CY to be opened to the mainland visitors everyday and I would like CY to demonstrate to us how he is tolerant to these problems.
In addition to what I have said in above, I think the tax can effectively reduce the number of non-targeted incoming visitors. HK can then have more capacity to serve the targeted customers so that they can enjoy a better traveling experience in HK...furthermore, the tax levied can be used to improve the infrastructure so Hong Kong can cope with more visitors and can better serve Hkers in the future. It's a win situation to HKers due to less congestion and other social problems, a win situation to the targeted visitors who can have a better experience and a win situation to HK government who will benefit from the tax financially. It's a win-win-win situation. So long as this objective, while it's well-intended in my opinion, is well-communicated with China, I am not particularly concerned about potential bad-feeling that Chinese people or Chinese official may have as I think they should also understand the current situation that Hong Kong is way too overloaded now.
There is already a very easy way to handle arrival tax for local and mainlanders. Mainlanders requires an entry visa, so that tax can be done at the visa issuance, and everytime they enter they pay the tax and a receipt with a unique barcode valid only for one day is issued. Then they produce that at the counter and scan the barcode.
"The chief executive also said the proposal, floated by politicians as a way of curbing the influx of mainland tourists, was not feasible as the government could not tax non-locals without taxing returning Hongkongers, too. He did not elaborate."
That's BS.. people who hold HKID cards when they pass through the border will be exempt from taxation. SIMPLE!




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