The sales of duty-free shops in China’s island province of Hainan exceeded 5 billion RMB (about $720 million) from July 1 to August 18. This represents an increase of 250% year on year.
The total sales of products priced over 8,000 RMB grew by a whopping 420% to 1.2 billion RMB. Despite travel restrictions due to COVID-19, a total of 740,000 customers visited Hainan’s duty-free shops during this period, up 70 % from last year.
In early June, Chinese authorities released a comprehensive plan to develop Hainan into a free trade port in order to boost local consumption and its tourism industry. Various policies offered to the province include exemptions on import duty, value-added tax and consumption tax on imported goods for the island’s residents.
The range of duty-free goods has expanded from 38 to 45 categories, and the previous tax-free limit of 8,000 RMB for a single product has been lifted.
To increase tourism, a pilot zone will be built for cruises and there will be investment into the development of Hainan’s yacht industry. The government will also encourage domestic and foreign airlines to launch more flights to and from Hainan, and an international airline will be set up in Hainan’s capital Sanya.
