HONG KONG: Hong Kong’s Government has confirmed that it is implementing a series of measures to counteract the impact of increased parallel trading activities in certain areas of the city, but has rejected the imposition of a land arrival tax.
There has recently been an influx of Mainland Chinese parallel traders taking advantage of the existing multiple-entry visa policy to buy stock tax-free in Hong Kong to resell in Mainland China at a profit. They purchase their supplies in Hong Kong, which does not charge a sales tax, and take them across the border to the Mainland in small quantities to avoid paying import duties.
As a consequence of the traders’ increased activity, law enforcement agencies in Hong Kong have been implementing a series of countermeasures to reduce the nuisance caused, and particularly to improve order at railway stations and boundary control points.
Measures to fine-tune and improve the arrangements under the Individual Visit Scheme for Mainland residents are also being considered. However, that is a policy that falls within the remit of the Central Government.
It was therefore confirmed that Hong Kong’s Government can only continue to relay the views of the Hong Kong community and the latest situation, including the number of Mainland passengers to Hong Kong, and the capacity of Hong Kong overall and the different districts that receive tourists, to the Central Government.
Regarding the possibility of imposing a land arrival tax for visitors, as had been suggested in a question in the Legislative Council (LegCo), Secretary for Security Lai Tung-kwok said that the proposal is “not feasible.”
“About 180,000 Hong Kong residents go to the Mainland every day,” he added. “If the tax were to be imposed on Mainland visitors, we could not just hope that the Mainland would not impose the same tax on Hong Kong people in return. Besides, the travel trade also largely opposes the proposal and considers that it will adversely affect the tourism, retail, and [the] food and beverage sectors.”
In a separate LegCo reply, Hong Kong’s Secretary for Commerce and Economic Development Gregory, So Kam-leung, confirmed that “the Government will continue to take targeted measures and enhance co-operation with relevant Mainland authorities to combat parallel trading activities.”
