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Japan Tempts Hong Kong Tourists with Tax-Free Purchases Starting at HK$350

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Tax breaks await Hong Kong tourists planning to visit Japan from December through April 2018, the latest in the string of polices announced by the Japanese government to encourage travellers from around the world to come and realise their holiday plans on the Land of the Rising Sun. Purchases starting from 5000 yen will be exempted from the 8% sales tax, The Standard reported.

Tax break for Hong Kong tourists

The new deal, according to the Hong Kong-based publication, is a departure from the old practice and will permit holidaymakers from the Special Administrative Region (SAR) to consolidate on their planned purchases, thus simplifying their shopping activities when in Japan. The tax break is already in effect and is understood to last until April next year.

Tourism executives in Hong Kong welcomed the move, seen as part of Japan’s ongoing program to lure in up to 40 million foreign visitors by 2020, and indicated “the policy in general will have a positive effect.” But according to Steve Huen Kwok-chuen, executive director of EGL Tours, the latest announcement is not expected to trigger an exodus of Hong Kong tourist flying in to Japan.

At best, Hong Kong travellers will be happier to visit and shop around in Japan but the announced tax holiday will not result to big spenders going on a splurge. The overall impact in terms of arrivals and spending will be insignificant, Huen told The Standard.

And a fellow industry executive is in agreement. Yuen Chun-ning, chief executive of Worldwide Package Travel Service, has observed that tourist arrivals from Hong Kong to Japan will generally stay the same even with the new tax program though he made clear that Japan’s latest effort “is still a positive administrative tool to attract more visitors.”

However, Yuen offered that when it comes to shopping it will be the Hongkongers’ buying psyche that will chiefly come into play. “Hong Kong people visit Japan frequently but without the intention of making a lot of purchases especially as many Japanese products can be found in Hong Kong at reasonable prices,” the industry official explained, adding visitors from SAR are “more sensitive to exchange rates and airfares.”

Japan favoured holiday destination of Hong Kong travellers

With or without the tax exemption, it was apparent that in recent years Japan has become a favoured vacation destination of tourists coming in from Hong Kong as well as the mainland China. From Hong Kong alone, Japan has managed to attract over 1.8 million visitors by the end of 2016, of which around 27% made the same trip to country twice or even thrice a year.

It is noteworthy too that for every Hong Kong tourist who visited Japan during the same period, the average spending amounted to no less than 25,000 yen per day, The Standard reported.