Consumers wait in line to buy duty-free products at Shilla Duty Free store in Jangchung-dong, central Seoul, on Oct. 21 after goods hit domestic shelves upon green light by customs office. [Photo by Han Joo-hyung]
South Korean duty-free operators will be allowed to offer tax-free stocks at home until the government decides otherwise.
The Korea Customs Service said on Tuesday that it will allow import clearance of duty-free goods in stock for six months until further notice in a move to help support the duty-free industry that has been struggling from Covid-19 impact amid a plunge in the number of overseas travelers.
In April, the customs authority decided to allow duty-free products to be sold in the domestic market until Oct. 28. The scheme will be extended until further notice, the office said.
The customs office also decided to allow duty-free operators to hand over goods to a third party instead of the buying source until the end of the year. This allows operators to send – or export – duty-free goods under three months in stock to other countries and sellers. Previously, they were only allowed to return short-term goods to where they bought from.
After the year end, the customs office decided to review the option of allowing goods to be taken out of the country to be delivered to pre-registered foreign purchasers.
The customs office asked for active cooperation from the retail industry to help save duty-free operators so that various support measures lead to job stabilization of duty-free operators and their suppliers.
The duty-free industry, meanwhile, which has been grappling from sluggish business due to Covid-19, is hoping that the latest measures would help recover business as domestic sales and sales to third party would allow them to secure liquidity.
Operators however call for more radical measures such as relief in non-operating tax dues until overseas travel normalizes.
Duty-free operators are liable to shoulder patent commissions – a kind of administrative commission for customs office’s patent-related work – and are linked to revenue. Last year, major operators paid 70 billion won ($62.3 million) in patent commissions.
By Kim Hee-rae and Lee Eun-joo
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]