China recently announced an increase in the tax exemption for mainland residents visiting Macau and Hong Kong, aiming to stimulate tourism and boost spending in these regions. This move is part of broader efforts to enhance economic ties and tourism flows between mainland China and its Special Administrative Regions (SARs).
Details of the Announcement:
On Friday, the Ministry of Finance, General Administration of Customs, and General Administration of Taxation jointly declared that the tax exemption for mainland residents entering Macau and Hong Kong will rise significantly. Previously set at RMB 5,000 (approximately US$688), the exemption will now increase to RMB 12,000 (about US$1,650).
Implementation and Scope:
Effective from July 1st, this measure will apply at six key border control points, including the Gongbei Border Gate and the Zhuhai Highway of the Hong Kong-Zhuhai-Macau Bridge (HZMB). By August 1st, it will extend to all entry control points except Hengqin.
Impact on Tourism and Economy:
The revised tax exemption allows mainland tourists to potentially enjoy up to RMB 15,000 (approximately US$2,065) in tax-free purchases from Macau and duty-free shops at border control points. This initiative aims to spur spending among mainland visitors, thus bolstering Macau’s tourism economy.
Supporting Measures:
In addition to the tax exemption increase, recent measures include facilitating group tourist travel between Hengqin and Macau on a multiple-entry basis within seven days (“group-in group-out” basis). Furthermore, the expansion of the Individual Visit Scheme to include 10 more mainland cities underscores China’s commitment to enhancing tourism links with Macau and Hong Kong.
Stakeholder Responses:
The Macao Government Tourism Office has welcomed these measures, highlighting their potential to attract more mainland visitors and stimulate economic growth through increased spending in Macau.
Overall, the adjustment in tax exemptions reflects China’s strategic efforts to foster closer economic and tourism ties with Macau and Hong Kong. By incentivizing spending among mainland tourists, these measures are expected to contribute positively to the economic vitality of the SARs.