Chinese tax free spending leaps

Chinese travellers boosted tax free spending by 30 per cent year-on-year in the last quarter of 2014.

And for the first time, Chinese shoppers accounted for more than one third of overall spending on tax free shopping, according to data from Global Blue, an international tax refund specialist. That’s the first time in any quarter.

Shoppers from Taiwan, South Korea and Hong Kong also boosted their spend, significantly, but from much lower bases.

Part of the reason for the dominance of Chinese in the retail sector is the collapse of the Russian rouble, which has decimated Russian offshore tourism and spending.

“The economic problems that have blighted Russia since the latter half of 2013 have really started to bite hard: in the final quarter of 2014 overall spending by Russians on Tax Free Shopping fell by a massive 32 per cent compared with the same period in 2013,” said Global Blue.

The increase from Chinese nationals offset declines by Russians and Global Blue says it emphasises the importance for tax free retailers to target Chinese and ensure their offers meet the market.

The number of transactions by Chinese residents increased faster than the overall spending, up 38 per cent, which means they are making more purchases at a slightly lower value per transaction.

“Spending by Russian residents, easily the second most valuable nationality after Chinese may be down, but there are always new nations emerging with the globe shoppers’ desire to combine travel and shopping,” said Global Blue.

Other standout results from the last quarter show Hong Kong residents boosted their tax free spending by 57 per cent, Taiwanese by 43 per cent and South Koreans by 38 per cent.

Residents of Indonesia and Singapore reduced their spending marginally.

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