Chief Executive John Lee Ka-chiu has cut Hong Kong’s spirits tax in a landmark move which could see the territory secure its role as Asia’s wine and spirits trading capital. Eloise Feilden reports. Lee announced on Wednesday (16 October) that spirits tax will be slashed to 10% and apply only to the portion of the bottle price over HK$200. Until now Kong Kong has had one of the highest spirits duties of any territory in the world, as drinks with an ABV of 30% or higher are currently taxed at 100%. Hong Kong’s leader said he’d taken the unusual measure to “promote liquor trade” as part of a broader drive to “explore new growth areas” for the territory, which is facing lower tourism numbers and foreign residents. Lee’s decision to cut spirits taxes will bring its approach to the category in line with its tax approach to both wine and beer. In 2008 Hong Kong ditched duties on wine, and has since become one of Asia’s key trading hub for the category. In 2018, a decade since the abolishment of wine duties, total wine imports to Hong Kong were US$153 million – an increase from the 2006 figure of US$121 million. Politicians in Hong Kong called on Lee to lift or adjust the spirits tax in mid-July. They argued that easing the high tax rate would attract more imported liquor businesses, trade distribution and auction activities. Nick Pegna, global head of wine and spirits at Sotheby’s auction house, told
This Article was originally published on The Drink Business - Wine
