Hong Kong To Levy $18 Per Head Tax On Travelers

by Mary Swire, Tax-News.com, Hong Kong

17 February 2003

The Hong Kong government has submitted proposals to the Legislative Council for an exit tax of HK$18 to be imposed on travelers leaving the territory by land or sea. Departing private cars will be taxed at a rate of HK$100 per car.

The SAR authorities announced last week that despite calls for greater integration with the Chinese mainland, a new tax levied 'at a reasonable rate' is necessary to improve border facilities and to help ease the government's economic woes.

According to reports, some 69 million people departed via land and sea immigration checkpoints last year, and it is thought that the new tax could generate an additional HK$1 billion in revenue each year. However, little of this is likely to flow into the government's coffers as the majority of the money will be used to fund infrastructure works.

Under the terms of the proposal, which has yet to be approved by lawmakers, passengers who must cross the border frequently for work purposes can pick up a discounted monthly ticket. Full time students, children under 12, public transport workers, members of designated international organisations, and those forced to cross the border in emergency situations will all be exempt from the fee, according to reports.

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