Hong Kong Liberal Party’s departure tax proposal for those crossing border by land and sea slammed as ‘unacceptable’, ‘insensitive’
- Idea mooted as part of plan to ease city’s ballooning deficit amid trend of residents spending in mainland China
- Economists, politicians say the proposal ‘sends the wrong signal’ and that there are other ways for government to raise revenue, trim budget deficit
A pro-business party’s proposal for authorities to impose a land and sea departure tax to ease the city’s ballooning deficit amid a trend of Hongkongers spending in mainland China has drawn scorn, with economists and other politicians warning the “politically insensitive” idea could backfire.
They instead appealed to the government to focus on ways to stimulate the market to create substantial revenue, such as ditching cooling measures on property sales and stock markets, and providing incentives to encourage Hongkongers and visitors to shop in the city.
The pro-business Liberal Party suggested at a meeting with Chan last week that a departure tax should be levied on Hong Kong permanent residents who leave the city by land and sea as a short-term measure to boost government revenue.
Hongkongers have been flocking across the border for leisure, shopping and dining, stretching their Hong Kong dollar which has strengthened against the yuan.
The trend has sparked concern from the city’s retail and catering sectors, which are still struggling with their post-pandemic recovery.
Hongkongers made nearly 72 million outbound trips in 2023, with almost three in four heading to mainland cities, statistics showed.
