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In a move to bolster the growth of the Hainan Free Trade Port and broaden the spectrum of zero-tariff goods, a joint announcement by the Ministry of Finance, General Administration of Customs, and State Taxation Administration released on Sunday has unveiled adjustments to the zero tariffs policy for raw and auxiliary materials within the port.

The updated policy marks an expansion of the range of zero-tariff goods, with 297 new items, including unbaked coffee, ethylene and machine parts, now qualifying for zero tariffs within the Hainan Free Trade Port.

Furthermore, the revised policy introduces relaxed restrictions, allowing entities meeting the specified conditions to transfer zero-tariff raw and auxiliary materials between them, exempting them from import tariffs, import value-added tax and consumption tax. Additionally, raw and auxiliary materials used for yacht maintenance and self-use production equipment will also be exempt from these taxes.

These policy modifications aim to signal a positive trajectory for the ongoing expansion of the Hainan Free Trade Port, reducing production costs for businesses, enhancing their competitiveness and boosting the attractiveness of the port, according to the Ministry of Finance.

The existing provisions of the zero tariffs policy for raw and auxiliary materials will continue to align with the regulations set forth in the 2020 notice issued by the three departments.

Since the inception of the zero tariffs policy for raw and auxiliary materials in December 2020, Haikou Customs' data showed that by November 2024, imports under this policy totaled 8.574 billion yuan ($1.183 billion), resulting in tax exemptions of 1.171 billion yuan.

Prior to these recent adjustments, the list of policy goods had expanded from 187 to 356 items from 2020 to 2024, covering sectors such as food processing, biopharmaceuticals and aviation maintenance. This broadening of policy applications has facilitated a shift from self-use production to processing and manufacturing, and from goods trade to service trade, showcasing a diversification of economic activities within the Hainan Free Trade Port.

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Hainan Free Trade Port adds 297 goods for zero tariffs