Japan tax break in the air for visitors

Top News | Sophie Hui 5 Dec 2017

Foreign visitors to Japan spending more than 5,000 yen (HK$350) will soon be exempted from an 8 percent sales tax even if multiple receipts are involved.

Under the current system only single purchases worth more than 5,000 yen qualify for the tax break.

According to Japanese government broadcaster NHK, the deal for consolidating purchase values will be good at least until April.

Steve Huen Kwok-chuen, executive director of EGL Tours, said the expansion of the tax exemption is welcome although it will not influence Hong Kong people planning to holiday overseas because 5,000 yen is not a big amount.

"It won't make people decide suddenly to go to Japan," he said.

So Huen said he did not expect the new measure to affect the number of Hongkongers already planning to visit Japan next Easter.

"The policy in general will have a positive effect," he said, "but it will not be significant."

Huen sees the move as part of a strategy by Japan to attract more tourists from around the world, noting that the government has set a goal of 40 million visitors in 2020.

"The new policy is targeted at those who shop modestly - not for crazy shoppers," he added.

Yuen Chun-ning, chief executive of Worldwide Package Travel Service, agreed that the tax break would not suddenly boost the number of people from the SAR heading to Japan.

"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," he remarked.

He sees Hongkongers as being "more sensitive to exchange rates and airfares."

Yuen also said the new policy will not encourage more people from Hong Kong to visit Japan in April, which is also when the country holds its annual peach blossom festival.

"But it is still a positive administrative tool to attract more visitors," he said.

Yuen also sees the tax break as looking more attractive to people visiting Japan for the first time, especially holidaymakers from the mainland and Thailand.

A Ms Goh, who visits Japan two to three times a year, said she would continue to visit the country with or without the new tax exemption.

"But of course it will be better if we get more of tax refund," she said.

In any event, she is unlikely to claim the tax refund if an item is not expensive and if the tax-refund claim procedure is too troublesome.

"If I buy something really expensive I'll make the tax claim,: she said. " For cheap items - around 5,000 yen - I won't bother if the claim procedure is complicated."

According to a report in July from the Japan National Tourism Organization, more than 1.8 million Hong Kong travelers visited the country last year, up 20 percent from 2015. And the average Hongkonger spent 25,433 yen a day.

And 27.5 percent of Hong Kong travelers went to Japan two or three times last year.

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