China Adjusts Tax-Free Shopping Policies for Hainan Island
Oct. 25 – In a move to boost tourism in the island province of Hainan, China’s Ministry of Finance (MOF) released the “Announcement on Adjusting the Tax-free Shopping Policies for Visitors Departing from Hainan Island (Announcement  No.73, hereinafter referred to as ‘Announcement’) on October 22, which is scheduled to take effect from November 1, 2012.
The Announcement makes the following adjustments to the tax-free policies for visitors departing from Hainan Island:
Adjusting the minimum age threshold of applicable visitors to age 16.
Adding three categories of tax-free commodities, including beauty and health care equipment, tableware and kitchen appliances, and toys; with the scope of tax-free commodities expanding to 21 categories.
Adjusting the upper value limit of tax-free commodities purchased each time by every visitor departing from Hainan Island to RMB8,000, with the number of tax-free commodities purchased expanding to an appropriate extent.
Apart from the above-mentioned adjustments, other contents of the tax-free shopping policies for visitors departing from Hainan Island shall be carried out according to the “Announcement of the Ministry of Finance Concerning the Pilot Implementation of Tax-free Shopping Polices for Visitors Departing from Hainan Island (Announcement  No.14),” and the tax-free commodities must comply with relevant regulations regarding inspection and quarantine, Chinese tags, product certification, hygiene licenses, and quality safety.
Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia.
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