Chen Maobo: Reducing alcohol taxes to promote high consumption in Hong Kong's food and beverage tourism industry will bring linked benefits

The Zhitong Finance App learned that the Chief Executive of the Hong Kong Special Administrative Region, Li Jiachao, announced in the Policy Address yesterday that from now on, the tax rate for spirits with an import price of 200 yuan or more will be reduced from 100% to 10%, while the tax rate for the portion of 200 yuan and below, and spirits with an import price of 200 yuan or less will remain unchanged. Financial Secretary Chan Mao-po said at the Policy Address press conference today that the goal of the alcohol tax reduction policy is to develop the spirits trade and promote activities in the high-consumption food and tourism industry, which will bring connected benefits. He believes the impact will be positive, and the authorities will evaluate and follow up.

Chen Maobo pointed out that when measuring this measure, they also took into account the experience of abolishing the red wine tax back then. From a trade perspective, after the abolition of the red wine tax, the value of imported red wine increased by more than three times, but the increase in sales was only double digits. The effect of boosting the trade in high-value red wine was obvious, but there was no significant increase in the number of red wine drinkers. Until last year, there was not much time difference between the amount of alcohol consumed per capita and the abolition of the wine tax. The government will take into account relevant experience and keep a close eye on it.

The Secretary for Commerce and Economic Development, Mr Yau Ying-wah, said that high-priced spirits account for 15% of the market, which is not very large, but the authorities are optimistic about the increase in spirits trade. He believes that the benefits brought by the increase in spirits trade are far greater than the increase in related logistics and warehousing costs. At the same time, reducing the alcohol tax will lead to the development of high-value-added industries such as animal logistics and storage, tourism, and high-end food and beverage consumption.