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Wednesday, 4th March 2015
In Business In Japan,

Japanese stores offering tourists tax-free shopping rise by 60%

It has emerged that the number of Japanese stores offering tax-free products to tourists has risen by 60 per cent over the last months, according to Nikkei Asian Review.

Since October 1st, duty-free products sold to travellers have expanded from the previous limitation of clothing and electronics to food and cosmetics, meaning that the government has its target of 10,000 tax-free shops by 2020 five years early. While cosmetic sales have seen a major boost in recent months, most of the stores are also concentrated in Tokyo and Osaka.

Over the last six months, a record 13.41 million tourists visited Japan, practically guaranteeing the Japanese government's aim to attract 20 million visitors annually by the time Tokyo hosts the Olympics in 2020. Retailers are sure to take advantage of these positive figures by offering tax-free shopping and abolishing the eight per cent consumption tax.

As part of the scheme, retails do need to place stickers on products warning customers not to open them before they leave Japan, or to adopt special adhesive packaging that will prove to customs that the item has not been opened in the country. Through this loophole, foreign tourists can buy goods at cheaper prices.

Cosmetics have proven very popular among tourists. A recent poll by the Japan Tourism Agency found that 38.5 per cent of travellers to Japan had purchased cosmetics and pharmaceuticals, making them the third most popular items behind food and confectionery. The average amount spent on cosmetics was $205.52 (£134.55), with most spending coming from China, Taiwan and Thailand. In total, three per cent of all tourist spend in 2014 was for shopping alone, making it an extremely lucrative opportunity for local officials.