Henry Tang: Tax exemption increase to RMB 12,000 is a good start

The Chinese government announced Friday (June 28) to raise the duty-free shopping quota for mainland visitors to Hong Kong and Macao special administrative regions.

Henry Tang, a member of the National Committee of the Chinese People's Political Consultative Conference (CPPCC), believes that this increase in the duty-free allowance for Mainland travelers will benefit Hong Kong's tourism and retail sectors, positively boosting the overall economy, with an estimated economic benefit of HK$8.8 billion to HK$17.6 billion.

Tang pointed out that at this year's Two Sessions, he proposed a motion titled Promoting the Development of Hong Kong's Tourism and Retail Industries, which included suggestions to optimize the duty-free policies for mainland visitors leaving Hong Kong and to open more cities for individual visit scheme travel to Hong Kong.

This proposal received support from over 140 Hong Kong CPPCC members, reflecting the expectations of many Hong Kong members and the desires of Hong Kong citizens.

Tang expressed gratitude to the Central Government for accepting the joint proposal from Hong Kong CPPCC members and meeting the earnest expectations of Hong Kong residents by raising the duty-free allowance for mainland travelers to Hong Kong.

Tang believes this move will benefit Hong Kong's tourism and retail sectors, positively boosting the economy. He also thanked the Central Government for its continuous support for Hong Kong since its return to China 27 years ago, providing essential resources whenever needed.

The increase in the duty-free allowance will be implemented through the unique framework of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA).

Tang noted that this agreement, directly signed between the Central Government and the Hong Kong and Macao governments, is unique and exclusive, not bound by World Trade Organization trade agreements.

Tang stated that the increase to RMB 12,000 is a good start, allowing for pilot implementations under this framework to assess its impact on mainland retail before making gradual adjustments.

Tang welcomed the increase in the duty-free allowance, comparing it to Hainan Island's annual duty-free allowance of up to RMB 100,000. However, the systems differ as Hong Kong and Macao's limits are per trip rather than annually.

He expressed confidence that the Hong Kong government and the industry will seize this opportunity to develop more "in-depth travel" routes, discover new cultural and tourism attractions, and organize more events to attract both domestic and international tourists, jointly building a "mega event economy" and a "cultural tourism economy."

In response to a question from DotDotNews, Tang mentioned that the Central Government and the HKSAR Government are continuously communicating to optimize transit arrangements. He highlighted that the "co-location arrangement" can help Hong Kong better integrate into the national development strategy, which is crucial for Hong Kong.

Recently, in addition to high-speed rail ports, the Lohu border crossing will gradually implement the "co-location arrangement."

Tang hopes that the HKSAR government will consider implementing this arrangement at the airport to enhance its connectivity and help Hong Kong International Airport regain its position as the world's leading airport.