According to the Zhitong Finance APP, China Galaxy Securities released a research report stating that the expansion of the &#34;buy and return immediately&#34; policy and the improvement of convenience will combine with the visa-free entry policy to contribute incrementally to inbound tourism consumption, thereby boosting domestic consumption demand. At the same time, considering that the &#34;buy and return immediately&#34; group mainly consists of foreign tourists, it is expected to effectively drive the consumption of high-quality domestic products. It is recommended to prioritize attention on benefiting channels, followed by benefiting products: duty-free and high-quality regional department retail channels will directly benefit, recommending CTG DUTY-FREE (601888.SH), and suggesting attention to Wangfujing (600859.SH), GREE REAL ESTATE (600185.SH), and SBGCL (600827.SH).
<h2>The main points of China Galaxy Securities are as follows:</h2>
Event: On April 8, the State Administration of Taxation issued a notice on promoting the &#34;buy and return immediately&#34; service measures for outbound travelers' shopping tax refunds, expanding this service from pilot areas to nationwide.
Boosting consumption is the government's primary task for 2025: Continuously introducing favorable policies
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In December 2024, the Central Economic Work Conference will elevate expanding domestic demand to a key priority, clearly stating the need to vigorously boost consumption.
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In 2025, the central government will allocate 300 billion yuan in special government bonds for subsidies for replacing old consumer goods with new ones, doubling the scale compared to 2024; the &#34;Special Action Plan for Boosting Consumption&#34; has deployed 30 key tasks across 8 major areas, covering income increase for urban and rural residents, consumption capacity assurance, quality improvement of service consumption, upgrading of bulk consumption quality, improvement of the consumption environment, optimization of restrictive measures, and enhancement of support policies.
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The current outbound tax refund efforts exceed expectations, and combined with the previous relaxation of the visa-free entry policy, it will stimulate overseas tourists to purchase competitively priced Chinese small appliances, 3C digital products, and light industrial products.
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Expansion of the &#34;buy and return immediately&#34; policy for outbound travelers, with improved convenience
1) What is &#34;buy and return immediately&#34;? China's &#34;buy and return immediately&#34; policy mainly targets outbound travelers (including residents of Hong Kong, Macau, and Taiwan). It refers to the process where, in areas where the outbound tax refund policy has been implemented, outbound travelers can purchase tax-refunded items at &#34;buy and return immediately&#34; stores, sign an agreement, and complete a credit card pre-authorization, allowing them to claim an equivalent amount in RMB (hereinafter referred to as prepayment) on-site at the store, where the outbound tax refund mainly returns the VAT portion. The advantage of the &#34;buy and return immediately&#34; policy is that it brings the outbound tax refund process forward to the shopping stage, facilitating overseas travelers' shopping and re-consumption, thereby enhancing their consumption power in China.
2) Expansion of the implementation scope of &#34;buy and return immediately&#34;: Previously, China's &#34;buy and return immediately&#34; policy was mainly piloted in Shanghai, Beijing, Guangdong, Sichuan, Zhejiang, Shenzhen, and other areas. This announcement marks the nationwide promotion of this policy.
3) Which stores can implement &#34;buy and return immediately&#34;? Duty-free stores in regions implementing the &#34;buy and return immediately&#34; outbound tax refund can provide &#34;buy and return immediately&#34; services after reaching an agreement with local tax refund agencies on prepayment and other matters. The significant effectiveness of the visa-free entry policy, combined with the &#34;buy and return immediately&#34; policy, is expected to further tap into the consumption potential of outbound travelers and expand China's openness to the outside world. With the further strengthening of China's visa-free entry policy after 2023, it is projected that in 2024, China will achieve 132 million inbound tourists, a year-on-year increase of 60.8%, including 26.94 million foreigners, a year-on-year increase of 96%
Restoring to 85% of the same period in 2019.
However, in terms of per capita consumption, foreign tourists' spending in 2024 is only USD 94.2 billion, corresponding to a per capita consumption of USD 713 (approximately RMB 5,138), with most spending on accommodation, transportation, and dining. It is expected that consumption of physical goods will be relatively low, and inbound tourist spending will only account for 0.5% of the GDP in 2024, which is still lower compared to Japan, a tourism-oriented country (approximately 1.3% of GDP in 2024).
China Galaxy Securities believes that the expansion of the &#34;buy now, pick up&#34; policy and the improvement in convenience not only respond to the central government's call to prioritize boosting consumption since the beginning of the year but also reflect China's desire to further open up against the backdrop of an escalating tariff trade war.
Risk Warning
The risk of policy implementation progress being lower than expected

600185

600859

601888

01880

600827

China Galaxy Securities released a research report stating that the State Administration of Taxation has expanded the "buy and refund immediately" policy, which will be combined with the visa-free entry policy. It is expected to boost domestic consumption demand, especially for high-quality domestic products. It is recommended to pay attention to beneficiary channels, such as duty-free and high-quality department retail, recommending CTG DUTY-FREE, Wangfujing, GREE REAL ESTATE, and SBGCL. The government will vigorously stimulate consumption, arranging CNY 300 billion in special government bonds for consumer goods subsidies in 2025, and the 力度 of departure tax refunds exceeds expectations, which will stimulate overseas tourists to purchase Chinese small appliances and other products

Zhitong

ZHUHAI ZHUMIAN GROUP

Wangfujing

CTG DUTY-FREE

SBGCL

China Galaxy Securities: Continued Boosting Consumption with a Combination of Measures, Departure Tax Refund Strength Exceeds Expectations