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Hainan province is set to inaugurate its first batch of daily necessities duty-free shops just before the Chinese New Year holiday, offering residents—including long-term foreign residents—the opportunity to benefit from the recently introduced duty-free import quota by the central government.
On February 11, three duty-free stores dedicated to daily necessities will open in the capital city of Haikou, along with one in Sanya and another in Danzhou, according to officials from the province’s commerce department.
Residents eligible for these benefits are defined as Chinese citizens with local ID cards, residence permits, or social security cards, as well as foreign nationals living and working in the region with valid residence permits. Tourists are not included in this program.
To promote the open nature of the free trade port, restrictions on who can invest in these duty-free stores will be minimal, with no limitations on participation by state enterprises, private companies, foreign-invested firms, or investors from Hong Kong, Macau, and Taiwan.
A joint notice issued recently by the Ministry of Finance, the General Administration of Customs, and the State Taxation Administration states that residents in the Hainan Free Trade Port can enjoy an annual duty-free allowance of up to 10,000 yuan (about USD 1,390) for selected imported goods purchased at approved locations. This exemption covers various taxes, including import duties, value-added tax, and consumption tax, as well as similar taxes applied within domestic circulation.
The duty-free imported products are restricted to 202 types of everyday items listed in the official catalog, such as baby formula, beef, toothpaste, seafood, pens, kitchenware, and fresh fruits. Purchases must be made and picked up on-site at authorized duty-free shops within Hainan.
Industry experts note that this policy is expected to reduce the prices of imported daily necessities by approximately 8 to 20 percent compared to mainland markets, helping to lower living costs for residents. For instance, using infant formula as an example, the duty-free quota of 10,000 yuan annually could save residents between 1,500 and 2,000 yuan (USD 209 to USD 278) in taxes.
Previously, visitors to the Hainan Free Trade Port could access an annual duty-free quota of 100,000 yuan (around USD 13,900) for luxury goods, while local residents only enjoyed duty-free benefits for 30 days if they held valid offshore departure certificates and documented travel records within the year. The offshore duty-free policy mainly covered high-end consumer products and did not fully include regularly used daily essentials.
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