China aims to ensure its citizen shop for international luxury brands within its own borders instead of travelling abroad. For this, the government, proposes a new annual limit of RMB100,000 ($14,000) per person for tax-free shopping in Hainan, China’s southernmost province. The popular tourist destination attracts more than 75 million, primarily domestic, tourists every year. The new limit is more than three times the current RMB 30,000 ($4,200).
The allowance rise and free port policy announcement followed the ‘Two Sessions’ annual plenaries of the National People’s Congress and the National Committee of the Chinese People’s Political Consultative Conference which ended last week. Among other aspects of the free port plan relevant to duty-free retailing include the plan to increase its number of tourists by making Hainan an international aviation hub; liberalising air rights including fifth and seventh freedoms; and the constructing a cruise tourism pilot zone.
According to consulting firm Bain & Company, the Chinese increased their share of the estimated $313 billion personal luxury goods market by up to 35 per cent last year. China was also responsible for almost single-handedly growing the personal luxury market in 2019.
