Hainan bets on FTP to spur consumption

Import levy and tax cuts to promote duty-free product purchases on island

China's plan to transform Hainan into a free trade port is expected to spur local consumption and enhance competitiveness of duty-free products, while greatly stimulating tourism and aviation industry on the island, experts said on Tuesday.

The plan, which covers key measures regarding the implementation of the free trade policy system, includes exemptions of import duty, value-added tax and consumption tax on imported goods purchased by island residents. It also includes measures to increase the quota for offshore duty-free shopping to 100,000 yuan ($14,020) per person every year from 30,000 yuan and increase the number of categories of duty-free products.

Zhao Ping, director of the international trade research department at the Academy of China Council for the Promotion of International Trade, said earlier residents on the island were not eligible to purchase duty-free products without tickets to depart the island. The new plan will allow island residents to buy duty-free products.