New Hainan Island duty free allowance could be in place by end of month

Details of the new Hainan Island duty free policy, which includes a new RMB100,000 purchasing allowance and expanded duty free category list are expected to be revealed at the end of the month or in early July.

The raised allowance and new duty free product categories is also expected to be implemented within this time-frame.

The decision to more than triple the existing RMB 30,000 duty free allowance is in line with plans for a Free Trade Port (FTP) on the tropical island. The overall FTP plan was released by the Chinese government on the 1st of June.

In recent years, the Chinese Ministry of Finance has increased the duty free special allowance on several occasions. In 2016, it was doubled to RMB 16,000 from RMB 8,000 and two years later it was raised to RMB 30,000. This marked the fifth adjustment to the quota since the successful offshore duty free scheme was introduced in 2011.

More products for daily consumption, along with additional luxury items will be added to the list of offshore duty free product categories. The number of categories now stands at 38 following the addition of medical devices last year. Categories include perfume, cosmetics, glasses and jewelry and purchases are limited to two items per person at any one time.


The expansion of the duty free range is part of the government’s overall FTP plan.

Ruslan Tulenov, Supervisor, Hainan Provincial Bureau of International Economic Development

Ruslan Tulenov, Supervisor, Hainan Provincial Bureau of International Economic Development (left) told TRBusiness: “Hainan is building a Free Trade Port and will become an International Tourism Consumption Centre.

“The opportunity to visit somewhere different is the main motivation for many tourists visiting Hainan, but they also want to shop. This increased allowance will give regular people like us the opportunity to purchase high-quality products in big quantities.”

Adding further details on the additional duty free product categories, Tulenov said: “We are expecting some product categories for daily consumption to be expanded, along with the addition of luxury brands such as Chloe, Vacheron Constantin, Gucci and Cartier.”

He commented: “It is important to point out that these are the items we are expecting to be introduced. Once the detailed policy is released, we will know which kind of products will be in both categories.”

The increased Hainan duty free allowance and additional duty free product categories are among several elements which will provide a strong platform for foreign businesses to enter China.

“The government wants to make Hainan a Free Trade Port with a zero-tariff policy on certain imported goods and items. Qualifying goods and items will be exempt from import duties, import value added tax and consumption tax.

“In short, China wants to share the benefits of the Hainan Free Trade Port with the rest of the world and make Hainan feel like heaven for shopping.”

The government’s FTP plans have already caught the attention of international players, according to Tulenov.

“Since the masterplan was released, many international companies in the travel, tourism, airline, luxury and leisure industries have expressed a desire to enter China through the Hainan Free Trade Port.”

Under current government plans, the aim is to complete the high-level FTP by 2050 and ensure it has a strong global influence.

He remarked: “The master plan for developing what is already China’s largest special economic zone into a Free Trade Port, suggests the aim is to develop the island into a globally influential duty-free trading center by the middle of the century.

“A mechanism for policy facilitation enabling free trade and investment is to be created by 2025. By then, the Hainan Free Trade Port will be established and the island will be a ‘Special Customs Supervision Area’. Hainan will be like a big duty free zone.”

Tulenov indicates the island will be developed into an FTP by 2035 and become the country’s major gateway to the rest of the world, especially South East Asia.

In the interim, the Hainan Provincial Bureau of International Economic Development must generate foreign investment in the FTP and provide a non-stop service for global investors.


Meanwhile, the Bureau is heavily involved in the organisation of next year’s China International Consumer Products Expo (Hainan Expo). This will be jointly held by the Chinese Ministry of Commerce and Hainan Provincial government.

The Hainan Provincial Bureau of International Economic Development is charged with the task of generating foreign investment in the Free Trade Port.

Source: This article was written by Andrew Pentol Senior Editor at TRBusiness

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