60% increase in liquor trading volume after Hong Kong tax cut: commerce chief

Hong Kong’s liquor tax cut has yielded “encouraging” results after trading volume rose by 60 per cent since the government slashed duties last October, the city’s commerce minister has said.

Secretary for Commerce and Economic Development Algernon Yau Ying-wah also said that authorities were studying whether US President Donald Trump’s latest order to impose an additional 10 per cent tariff on Chinese imports included Hong Kong.

Speaking on a radio show on Tuesday, Yau revealed that since Chief Executive John Lee Ka-chiu announced in his policy address last October the cut in liquor taxes, the trade value had increased by 1.5 times as of January and the volume by 60 per cent.

“The results have been encouraging since we cut the liquor tax. That is a good start,” he said.

“We hope to become a trading hub for spirits and boost the business of the catering, hospitality, logistics and warehousing industries along the chain. I also hope that Hong Kong can become the global trading hub for Chinese baijiu. ”

Baijiu, which translates as “white alcohol”, usually has between 40 and 60 per cent alcohol content. It is generally distilled from sorghum, although wheat, barley, millet or glutinous rice are also used.

Before the cut, the tax rate was 100 per cent on liquor with more than 30 per cent alcohol content, regardless of the price.