Duty free to double in Japan

Last year, the number of visitors to Japan hit a record 10.36 million. Freed of visa restrictions, visitors from southeast Asia are surging ahead; the number of visitors from Thailand showed a 64.7% year on year growth in Q1 2014, Malaysia grew 61% and Vietnam by 56.2%.

By 2020, the year of the Tokyo Olympics, the government hopes for 20 million visitors annually. Alongside this growth, the Japanese government hopes to double the number of duty free shops to around 10,000 by encouraging shops outside the major cities to apply for relevant permission. Most duty free shops are currently located in the Tokyo, Yokohama and Osaka regions.

This October, rules that limit duty free items to electrical appliances and fashion goods are to be abolished. As a result, all items including food, alcohol and cosmetics can be sold duty free, shaving the 8% consumption tax. Japanese cosmetics are already a popular tourist purchase with, for example, over 90% of Chinese tourists buying them. The Japan National Tourism Organisation expects these moves to generate Japanese yen JPY260bn in additional economic benefits within five years. The government expects to finalise these plans in June.