China to raise duty-free limit for visitors to HK, Ming Pao says

Chinese tourists will soon be allowed more duty-free shopping in Hong Kong, with Beijing set to raise the purchasing limit by up to sixfold to help boost the city’s sluggish retail sector, according to a newspaper report on Thursday.  

The Chinese government will soon announce the measure to raise the duty-free shopping quota, currently capped at 5,000 yuan, to “lower than 30,000 yuan ($4,128),” according to Ming Pao, which cited unnamed sources.

While Hong Kong doesn’t levy tariffs on most imports and exports, items bought in the city, when brought back to mainland China, are taxed on values exceeding the duty-free allowance. 

Hong Kong has been struggling to regain its status as a shopping hub, as mainland visitors — the city’s largest source of tourism — are increasingly attracted to nearby rivals such as tax-free island Hainan and casino town Macau. Japan, with its weak currency, has also been gaining more duty-free shoppers from the region. 

The reported move also comes as mainland Chinese tourists, grappling with a property market crisis and slower wage gains, have shifted to sightseeing and eating in Hong Kong rather than splashing out on Louis Vuitton handbags and smartphones.