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Joint effort helps Chinese visitors claim tax refunds

2014-09-23 10:05 China Daily Web Editor: Wang Fan
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As Chinese travelers become big overseas spenders, companies are unearthing a hidden "gold mine" - the huge amount of unclaimed tax refunds.

A total of $3.86 billion in unclaimed tax refunds will be accumulated by Chinese traveling overseas this year, accounting for 20 percent of the total amount, said Hui Chengkun, president of HNA Transforex Currency Exchange, citing data from tax refund companies.

Transforex partnered with MasterCard and seven leading tax groups to launch the largest tax refund platform in Shanghai on Monday.

This will enable MasterCard holders to obtain tax refunds at home instead of lining up at an airport. Chinese-language services will be provided, Hui said.

The service will also help to reduce the time taken for refunds to reach travelers' accounts from weeks or even months to less than five days.

Last year, about 98 million Chinese travelers spent $128.7 billion on shopping overseas, other than travel and accommodation expenses. But obtaining tax refunds has been an unpleasant experience for most shoppers.

Zhou Peng, a young traveler from Shanghai, said, "I didn't buy anything in France when I learned it could take 40 minutes to line up for a tax refund."

Hui said, "Language barriers are the main reason that Chinese customers do not claim their tax refunds, while tedious procedures add to the difficulties of those willing to do so."

A survey by Swiss tax group Global Blue showed that tax refunds claimed by visitors from China rose by 9 percent year-on-year in the second quarter, compared with a 3 percent decline globally. In France, tax refunds for each Chinese visitor rose by 23 percent to an average of 1,315 euros ($1,690), Global Blue said.

But Hui said that despite China's rapidly growing tourism industry, the country is still at an early stage in claiming overseas travel tax refunds, and the amount of unclaimed refunds is increasing annually.

Dennis Chang, who heads MasterCard's China operations, said the tax refund platform launched on Monday comes amid rising demand, with China becoming the world's largest overseas travel market.

Hui said, "Our goal in the initial stage is to lower unclaimed tax refunds by 5 percentage points via the platform."

The platform will cover more than 50 countries and about 420,000 merchants in Europe and Asia and include about 90 percent of the world's travel tax refund market.

In July, Internet giant Alipay launched a service allowing Chinese tourists to get refunds of duty wired directly to their Alipay accounts, covering about 5,000 retailers.

Industrial and Commercial Bank of China has also teamed up with Global Blue to conduct tax refunds in 270,000 stores in more than 30 countries.

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