Editorial | Mainland tax refunds for tourists can also benefit Hong Kong
With the right coordination, there is ample opportunity now to boost the number of visitors to China, with our city key for those travelling to multiple destinations
The need for mainland China to boost domestic consumption as a driver of economic growth has been made more urgent by the United States trade war.
International visitors may not be domestic consumers, but they offer huge potential for lifting spending on goods and services inside the country.
Even after a surge in revenue from foreign tourism last year, it accounted for only 0.5 per cent of gross domestic product in China’s massive market, compared with 1 to 3 per cent in most developed countries.
There is much room for tourism to grow as a pillar of the mainland’s economy.
The authorities have moved to tap into this potential by liberalising a concession much valued by tourists – tax refunds on purchases.
The decision, announced by the Ministry of Commerce and five other departments, took effect immediately, along with the implications for Hong Kong, which is a duty-free port.
Visitors to the mainland, including Hongkongers, can now claim refunds of tax on purchases of more than 200 yuan (HK$213) instead of 500 yuan. The maximum cash refund rises from 10,000 yuan to 20,000 yuan, with no limit on bank transfers.