China expands instant tax refund nationwide for overseas tourists

China expands instant tax refund nationwide for overseas tourists

China will expand its instant tax refund for purchases by overseas tourists nationwide in a move to boost inbound travel and consumption, the State Taxation Administration said on Tuesday.

The service, which allows foreign visitors to receive tax rebates immediately after buying, rather than upon departure, was previously piloted in cities including Beijing, Shanghai, Guangzhou, Chengdu, Hangzhou and Shenzhen.

Under the new rules, tourists making purchases at designated stores can receive their refunds on-site after completing a credit card pre-authorisation. Upon departure, customs will verify the traveler’s identity and the goods, and the refund agency will lift the pre-authorisation once all information is confirmed.

Li Xuhong, deputy dean of the Beijing National Accounting Institute, said, “By tapping into inbound consumption potential, the move would improve China’s tourism climate and help promote high-quality economic growth.”

Full text of the policy

Announcement on Promoting the “Instant Tax Refund” Service for Overseas Tourists

State Taxation Administration
Announcement No. 9 (2025) of the State Taxation Administration

To further enhance the convenience of tax refunds for overseas tourists and improve their shopping experience in China, based on the outcomes of previous pilot schemes, the State Taxation Administration has decided to fully implement the “Instant Tax Refund” service (hereinafter referred to as the “Instant Tax Refund”). The relevant matters are hereby announced as follows:

I. Key Features of the Instant Tax Refund

The “Instant Tax Refund” refers to a service available in regions where the tax refund policy for overseas tourists has been implemented. When an overseas tourist purchases tax-refundable goods at a store offering this service, signs an agreement, and completes a credit card pre-authorisation, they can immediately receive a payment in Renminbi (RMB) equivalent to the refundable tax amount (hereinafter referred to as the “advance refund”).

If the overseas tourist passes customs verification upon departure, leaves from a designated port within the agreed timeframe specified in the agreement, and meets the requirements of the tax refund policy, the refund agency will release the credit card pre-authorisation and complete the tax refund process. If the tourist fails to meet these requirements, the advance refund will be reclaimed through the credit card pre-authorisation deduction, and the tax refund procedure will be handled in accordance with regulations.

In regions where the tax refund policy is already in effect and where conditions for implementing the “Instant Tax Refund” exist, the respective provincial tax authorities may formulate local implementation plans. Once they enable the “Instant Tax Refund” function within the State Taxation Administration’s tax refund management system, the service may be launched.

Tax refund stores in these regions that wish to provide the “Instant Tax Refund” service may become “Instant Tax Refund” stores after reaching an agreement with the local refund agency regarding advance payments and other related matters.

Provincial tax authorities (including those in autonomous regions, municipalities directly under the central government, and cities with independent planning status) should collaborate with cultural tourism, commerce, finance, and customs departments to create favourable conditions for implementing the “Instant Tax Refund” service and encourage local stores and refund agencies to provide this service.

II. Procedures for the Instant Tax Refund

Overseas tourists applying for the “Instant Tax Refund” must meet the eligibility criteria under the tax refund policy and complete the following steps:

1. Store Purchase and Advance Refund

When an overseas tourist purchases refundable goods at an “Instant Tax Refund” store and chooses to use the service, the store or refund agency must present the agreement, have the tourist sign it, complete the credit card pre-authorisation, issue the “Application Form for Tax Refund for Overseas Tourists,” and provide the advance refund on-site.

2. Customs Verification

Upon departure, the tourist must declare the tax-refundable goods to customs and present the goods, the “Application Form for Tax Refund,” the sales invoice, and valid identification for inspection and verification.

3. Refund Agency Review

The tourist must submit their passport or other valid ID, the customs-verified “Application Form for Tax Refund,” and the sales invoice to the refund agency located in the sterile area (secured departure zone) of the departure port. The refund agency will review the documents and proceed as follows:

• If the tourist departs within the agreed timeframe from the designated port and meets the tax refund policy requirements, the agency will release the credit card pre-authorisation, and the advance refund will be considered the final tax refund.
• If the tourist does not meet the policy requirements, the agency will reclaim the advance refund via the credit card pre-authorisation and will not process a refund for that transaction.
• If the tourist fails to depart within the agreed timeframe or from the designated port, the refund agency will, within three working days after the agreed departure date, reclaim the advance refund via credit card. When the tourist eventually departs, the refund agency at the departure port will handle the refund according to standard tax refund procedures.

4. Settlement by Tax Authorities

The refund agency shall periodically settle the refunded amounts with the competent tax authority in accordance with the tax refund policy.

III. Implementation Date

This announcement shall take effect from the date of its publication. This is hereby announced.

State Taxation Administration
4 April 2025

Interpretation of the Announcement on Promoting the “Instant Tax Refund” Service for Overseas Tourists by the State Taxation Administration

To further enhance the convenience of departure tax refunds for overseas tourists and optimise their shopping experience, the State Taxation Administration has issued the Announcement on Promoting the “Instant Tax Refund” Service for Overseas Tourists (hereinafter referred to as the “Announcement”). The relevant contents are interpreted as follows:

1. What is a departure tax refund?

A departure tax refund refers to the refund of value-added tax (VAT) on tax-refundable goods purchased by overseas tourists at designated stores when they leave China through a departure port.

Overseas tourists refer to foreigners and compatriots from Hong Kong, Macao, and Taiwan who have stayed in mainland China for no more than 183 consecutive days.

2. What is the “Instant Tax Refund”? What are the conditions for tourists to enjoy this service?

The “Instant Tax Refund” is a facilitation measure within the departure tax refund system. It refers to the practice in areas where the tax refund policy has been implemented, allowing overseas tourists who purchase tax-refundable goods at participating stores, sign an agreement, and complete a credit card pre-authorisation to receive on-site an advance refund in RMB equivalent to the refund amount.

To enjoy this service, tourists must:

• Pass customs verification upon departure.
• Depart through the designated port within the agreed period as stated in the agreement.
• Meet the requirements of the departure tax refund policy.

3. What conditions must goods meet to be eligible for the “Instant Tax Refund”?

All goods eligible under the current departure tax refund policy also fall within the scope of the “Instant Tax Refund” service.

4. What are the requirements for becoming an “Instant Tax Refund” store?

In areas where the “Instant Tax Refund” policy is implemented, tax refund stores that are willing to provide this service can become participating stores after reaching an agreement with the local tax refund agency on matters such as advance refunds.

5. What is the process for overseas tourists to apply for the “Instant Tax Refund”?

The process involves three main steps:

• Store transaction and advance refund:
• After signing the agreement, the tourist completes a credit card pre-authorisation.
• The store issues an Application Form for Tax Refund for Overseas Tourists.
• The store pays the advance refund on-site.
• Customs verification:
• The tourist presents the refundable goods.
• Submits the Application Form for Tax Refund.
• Provides the purchase invoice and valid identification to customs at the port of departure for inspection.
• Review by the refund agency:
• The tourist submits their passport or other valid ID
• Provides the customs-verified application form and sales invoice to the tax refund agency located in the departure port’s restricted area.
• If compliant, the refund agency releases the credit card pre-authorisation and completes the refund procedure (the advance refund is deemed the final refund).

6. What is the agreement? Must it be signed by the tourist personally?

The agreement is a document signed by the overseas tourist choosing the “Instant Tax Refund” service. It states that the tourist:

• Understands the rights and responsibilities of the service.
• Agrees to depart from the designated port within the agreed timeframe.
• Consents to using credit card pre-authorisation as a guarantee to receive the advance refund under agreed terms.

Key points:

• The agreement must be signed personally by the tourist.
• The store or tax refund agency must properly retain the signed agreement.
• Responsibility for storing the agreement is determined by the store and the refund agency.

7. What is a credit card pre-authorisation?

A credit card pre-authorisation is a process where:

• The store or refund agency pays the advance refund to the tourist.
• An equivalent amount is frozen on the tourist’s credit card.

Key requirements:

• Must be handled by the store or refund agency.
• The pre-authorised amount must match the advance refund amount.
• The refund agency in the store’s region manages releasing/deducting the pre-authorised amount.
• Relevant bank documents must be properly retained.

8. What is the advance refund? How can tourists receive it?

The advance refund:

• Is an amount in RMB equivalent to the tax refund.
• Paid on-site by the store to the tourist.
• Can be in cash or electronic payment form.

Payment arrangements:

• Fronted by the store or refund agency.
• The responsible party, payment method, and limits are determined by provincial tax authorities in coordination with stores and agencies.

9. How is the amount of the advance refund calculated?

Calculation method:
Advance refund = Refundable VAT Amount
Refundable VAT = (Invoice amount including VAT × Refund rate) – Tax refund service fee

10. What happens if the tourist fails to comply with the agreement?

For non-compliance (e.g., missing departure date/port):

• The refund agency will deduct the advance refund via credit card within 3 working days after the agreed departure deadline.
• When the tourist eventually departs, the departure port’s refund agency will verify and process the refund according to current policies.