Hainan to adopt offshore duty-free policy

The offshore duty-free policy trial for South China's tropical island province of Hainan will be announced Thursday.

Details of who will be entitled to the benefit, what kind of products are covered by the policy, how many items a tourist can purchase, the maximum refund and specific procedures will also be released, Shanghai Securities News reported Tuesday.

The offshore duty-free policy allows domestic tourists to purchase certain items on the island without taxation. Those items mainly include tariff duties, consumption tax and business tax. The duty-free products will retail for about 70 percent of the original prices, the report said.

During China's annual two political sessions, officials from Hainan province disclosed that a tourist would not need to pay taxes on items totaling no more than 5,000 yuan ($743.49) for a single tour, and enjoy the duty-free policy twice a year. Any amount exceeding 5,000 yuan will be subject to preferential taxation, the report said.

In January, Hainan inaugurated a tax refund program to attract foreign tourists. But the result was not encouraging, as less than 3 percent of the tourists were foreigners.

The offshore duty-free policy is aimed at domestic tourists, so it is regarded as one of the major measures to attract travelers and promote the economic development of the island.

Insiders think the policy will also drive up the development of sectors like aviation, logistics, lodging and dining in Hainan, the newspaper reported.

Officials hope to launch the program in time for the May Day holiday.