China Extends Tax-Free Shopping Incentive

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

30 December 2015

From January 1, 2016, foreign visitors to the Chinese provinces of Tianjin, Liaoning, Anhui, Fujian, Xiamen, and Sichuan will be able to obtain value-added tax (VAT) refunds on consumer goods purchased from designated shops.

Hainan has piloted a tax refund scheme since 2011, and Beijing and Shanghai were authorized to begin offering VAT refunds to tourists on July 1, 2015. A number of provinces had expressed an interest in joining the scheme following a Ministry of Finance announcement earlier this year that it would be further extended to boost inbound tourism and consumption.

Tourists must spend at least RMB500 (USD77) on eligible items in any one store in a single day to be able to claim an 11 percent VAT refund.

Hong Kong, Macao, and Taiwanese residents will now also be eligible for the rebate, providing they have not stayed on the Mainland for more than 183 days.

TAGS: tax | value added tax (VAT) | China | Macau | Taiwan | ministry of finance | Hong Kong | tax breaks | VAT refunds

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