China plans to unlock the potential of tourism consumption through the establishment of more duty-free shops.
Speaking on Friday, Jan. 29, head of the China National Tourism Administration Li Jinzao said that a major task in 2016 is to expand the tax refund policy to more cities. The move will help attract overseas tourists and promote their consumption.
Li added, "At the same time, we will also explore opening more duty-free shops, expanding duty-free items and lifting the cap on duty-free purchases."
Providing tax refunds has historically been a way for cities and nations to attract tourists and promote consumption. Over 50 countries and regions in the world have tax refund regulations, including the United States, South Korea, Japan, Canada, Thailand and Brazil.
According to China Daily, China is following suit by introducing ways for tourists to buy duty-free products. For instance, visitors from abroad can claim a tax refund if they purchase goods at designated outlets in cities like Shanghai, Beijing, and Xiamen in Fujian Province. Chinese tourists traveling abroad can also purchase duty-free goods at airports.
In Hainan Province, all tourists can buy duty-free products.
The deputy director of Hainan's Department of Finance, Wang Huiping, pointed out that the duty-free policy has helped the province to establish an "international tourism island."
Since the inception of the program in 2011, Hainan's duty-free outlets get more than 5.7 million clients who spent 16.5 billion yuan ($2.5 billion). Sales volumes in 2015 hit 5.54 billion yuan.
Wang said, "Hainan will further ease its duty-free policy for tourists by lifting the cap on shopping times and opening online duty-free shops starting from Feb 1."
Based on Hainan's new regulation, nonresidents leaving the island can buy duty-free goods of up to 16,000 yuan a year with no limits on shopping visits. Initially, tourists could only use a duty-free shopping service twice annually. The change will further encourage growth in both sales volume and the number of tourists using the service.