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Over the past month, as China implemented optimized departure tax refund policies, Shanghai experienced an 86 percent increase in total sales from this channel, with the refunded amount jumping 77 percent year-on-year, surpassing all other locations in the country.

Shanghai Municipal Tax Service released the above data at the end of last month.

According to the new measures, which took effect at the end of April, the minimum purchase required to qualify for a departure tax refund has been lowered from 500 yuan to 200 yuan (approximately $27.80) for purchases made within the same store. The maximum cash refund limit has been raised from 10,000 yuan to 20,000 yuan.

Chen Xiaoling, general manager of Shanghai's Florentia Village, a luxury outlet, said that the changed limits have benefited both higher valued products and daily necessities. The 200-yuan limit makes the favorable policy more easily accessible to overseas tourists to China.

Over the past month, Florentia Village has received more than 100 departure tax refund applications for purchases under 500 yuan, according to Chen.

According to Shen Ying, finance director of Fast Retailing (Shanghai) Trading Co Ltd, travelers now only need to buy a single item to qualify for a tax refund under the new measures. For example, a 200-yuan product can yield an 18-yuan refund. This has significantly boosted tourists' enthusiasm for spending, resulting in increased foot traffic at Uniqlo stores, Shen said.

The new measures have also relaxed the registration requirements for tax refund stores. Newly opened stores with an M-level tax credit — typically referring to newly established businesses or those without operating income during the evaluation period but meeting specific scoring standards — are now allowed to apply to become tax refund stores if they meet other criteria.

Shanghai Pumo Brand Management Co Ltd, a startup founded in June last year, applied to register one of its central Shanghai stores as a tax refund store on April 30. The approval was granted on the same day.

Shanghai saw an additional 120 tax refund stores registered over the past month, with the total number exceeding 1,200, according to the Shanghai Municipal Tax Service.

Meanwhile, Shanghai has enhanced services that allow consumers to receive tax refunds directly at the point of purchase. To date, 60 such stores operate in the city, along with 11 malls offering collective tax refund services for multiple retailers.

Plaza 66, a commercial complex in central Shanghai’s Jing’an District, was the first mall in the city to offer collective tax refund services. According to Janice Cheung, director of Chinese mainland business operations at Hang Lung Properties, the mall processed over 280 tax refunds as of May 27 — already surpassing the total figure for all of 2024.

The new policy has further strengthened Shanghai’s appeal as an international shopping destination. As a result, more brands are expected to open their first or flagship stores in the city, she added.