The Hong Kong authorities are set to expand the scope of passengers exempted from paying the air passenger departure tax from Oct 1 under the city’s amended Air Passenger Departure Tax Ordinance.

The special administrative region government is set to gazette the related order on Friday and table it before the Legislative Council (LegCo) on June 18.

The ordinance currently allows certain classes of passengers to be exempted from the departure tax, including children under 12 years, direct transit or connecting flight passengers, passengers arriving at and departing from Hong Kong by aircraft on the same day, and passengers arriving at the Hong Kong International Airport (HKIA) by vehicle via the Hong Kong-Zhuhai-Macao Bridge or by ship and subsequently departing by aircraft while remaining within the restricted area at all times before departure.

ALSO READ:  LegCo passes bill to raise air departure tax

The exemption will be expanded to include passengers arriving at the HKIA by aircraft and departing from the airport by aircraft on the arrival day or on the following day, which is a maximum of 48 hours, according to the government.

Passengers arriving in the city via immigration controls by means other than by aircraft and departing from the HKIA by aircraft on the arrival day or on the following day, which is a maximum of 48 hours, will also be included in the departure tax exemption, it added.

Based on air passenger traffic statistics in 2024, the exemptions could benefit about 830,000 air transfer passengers and about 2.5 million intermodal transfer passengers annually, leading to a potential revenue foregone of about HK$670 million per year.

The SAR government will engage the Airport Authority to handle refund applications centrally for all eligible passengers. The HKIA will set up a new e-application platform for passengers to apply for a refund by cash at the airport or by other means such as credit cards and electronic payment platforms.

“The new exemptions can help attract more passengers to use the HKIA, thus consolidating Hong Kong's status as an international aviation hub,” said a spokesman for the HKSAR government.

READ MORE: HKIA world's busiest cargo airport, 9th in passenger traffic

The government expects the exemptions to bring about positive economic benefits as there will be more transfer passengers' spending on hotel accommodation and local consumption during their stay, the spokesman added.

An exclusionary provision will be incorporated into the amendment order to prevent people from making a brief return trip between Hong Kong and the Chinese mainland and Macao deliberately to be eligible for the exemption.

First proposed in the 2025-26 Budget, a departure tax increase from HK$120 to HK$200 per passenger was passed by the LegCo on May 28. It would apply to air tickets purchased from Oct 1 onwards and is expected to increase government revenue by about HK$1.6 billion per year.

Noting that while the increase will only have a minimal impact on air passengers as it constitutes a very small portion of the overall traveling cost of the public and tourists, the SAR government said having considered the views of stakeholders, new exemptions were made to enhance the airport's competitiveness.