LCQ5: Liquor duty
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Question:
Since October last year, the Government has reduced the duty rate for liquor with import price over $200 from 100 per cent to 10 per cent for the portion above $200. In this connection, will the Government inform this Council:
(1) whether it has compiled statistics on the changes in the value and volume of imports and re-exports of liquor to date after the reduction in the duty rate on liquor, and how such data compare with those prior to the reduction, together with a breakdown by type of liquor (e.g. Chinese baijiu, whisky and brandy);
(2) as the Government has indicated that the reduction in the duty rate on liquor aims to promote the development of Hong Kong into a trading hub for high-end liquor and boost the growth of various industries such as catering, hotel, logistics and warehousing, whether the Government has assessed if the policy has achieved the expected effects after its implementation; whether the Government will study a further reduction in the duty rate on liquor; if so, of the details; if not, the reasons for that; and
(3) whether the Department of Health has, after the reduction in the duty rate on liquor, conducted a population health survey to compile statistics on the proportion of the population aged 15 or above who have consumed liquor; whether it will step up its efforts to publicise and educate the public about the health effects of alcohol, in order to prevent problems such as alcohol dependence, alcohol abuse and binge drinking; if so, of the details; if not, the reasons for that?
Reply:
President,
Having consulted the Health Bureau, the Census and Statistics Department (C&SD) and the Customs and Excise Department (C&ED), the consolidated reply to the question raised by Dr the Hon Kennedy Wong is as follows:
Currently, liquor duty in Hong Kong is levied on liquor for local sales or other uses, while liquor for export or re-export through Hong Kong to other regions is not subject to duty. As such, the liquor duty reduction has a more direct impact on liquor imported for local consumption, whereas the re-export trade of liquor is more influenced by macro factors such as global economic conditions and geopolitics.
According to the statistics from the C&ED, during the 8.5-month period from the reduction of the duty rate on high-end liquor on October 16 last year to the end of June this year, both the volume (in litre) and value of duty-paid liquor import increased as compared with the 8.5-month period prior to the liquor duty reduction. Of these, the import volume of liquor rose by more than 20 per cent, while its value went up significantly by nearly 90 per cent, reflecting that the two-tier system introduced by the Government is effective in boosting high-end liquor trading. A comparison of the volume and value of duty-paid liquor before and after the reduction in liquor duty rate, as well as detailed statistics breakdown by type of liquor, is provided in Annex I for Members' reference.
On the other hand, as liquor duty is not levied on re-exported liquor, the C&ED does not maintain statistical data on the value of liquor re-export. The information provided by the C&SD is set out in Annex II.
As the liquor duty reduction has only been implemented for a short period, its effectiveness in various aspects remains to be observed. Regarding the suggestion from some members of the trade that the Government should further reduce the duty on liquor, we would like to reiterate that the purpose of lowering liquor duty is to encourage the trade and auctions of high-end liquor in Hong Kong, thereby giving impetus to the development of other high value-added sectors such as logistics and storage, tourism as well as high-end food and beverage consumption. At the same time, we are also mindful of the need to avoid increasing liquor consumption among the public as a result of reducing liquor duty, thereby leading to other problems.
When introducing the relevant measures, the Government has fully balanced different policy considerations such as promoting economic development, maintaining stable public finances and protecting public health. We will closely monitor the development of the liquor trade and review the effectiveness of the measures in a timely manner. Any further adjustments will require careful consideration of the impact on different aspects with prudent planning. The Government currently has no plan to further adjust the duty rate on liquor.
In fact, the Government has been attaching great importance to the harms brought by alcohol, in particular alcohol dependence, alcohol abuse and binge drinking. In 2018, the Government launched the "Towards 2025: Strategy and Action Plan to Prevent and Control Non-communicable Diseases in Hong Kong", setting out nine local targets, with "reduce harmful use of alcohol" being one of them, to be achieved by 2025. The Government will continue to adopt a risk-based approach to reduce alcohol-related harm through publicity, education, treatment and support services. Among which, the Department of Health (DH) has launched the Pilot Alcohol Cessation Counselling Service (Pilot Programme) through subvention to a non-governmental organisation. The Pilot Programme was launched on April 8, 2024, and will last for two years to provide free counselling service for Hong Kong residents identified to have probable alcohol dependence. The DH has also launched a publicity and education campaign named "Understanding Alcohol Harm" since 2022 to enhance the public's understanding of the health risks associated with alcohol consumption; and provides online risk assessment of drinking behaviour, personalised health advice, self-help tools, health education resources, etc to encourage drinkers to change their drinking behaviour for the sake of their health.
In addition, the DH conducts the Population Health Survey (PHS) approximately every five years with the Health Behaviour Survey conducted in between as regular surveillance to understand the health status of the Hong Kong population, including drinking behaviours. Figures relevant to drinking behaviours in past PHSs are set out in Annex III. The 2025/26 PHS is expected to commence in the third quarter this year with the findings to be available in end-2026, which would reflect the situation after the partial reduction of duty on liquor.
Ends/Wednesday, July 23, 2025
Issued at HKT 16:00
Issued at HKT 16:00
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