In a remarkable turn of events, tax refund applications in China have experienced a significant surge, with Shanghai reporting a striking 168% increase in 2025, effectively revitalizing inbound tourism in the wake of the pandemic.

According to data from the Shanghai Customs released on Tuesday, the first eight months of 2025 saw 96,600 verified departure tax refund applications, reflecting a year-on-year growth of 168 percent. The total merchandise value of these refunds reached 2.07 billion yuan, equivalent to approximately 290 million dollars, marking an 83 percent increase and surpassing the full-year totals from 2024.

During the peak summer travel season, the customs office at Shanghai Hongqiao International Airport processed 3,329 departure tax refund applications, illustrating a robust 40 percent rise compared to previous figures. The total verified refund amount reached 125 million yuan, which also indicates a year-on-year increase of 31 percent.

This increase in tax refund applications aligns with the broader national initiatives aimed at refining tax refund mechanisms and is bolstered by the rising influx of international tourists. Since the start of 2025, cities across the country have actively adopted departure tax refund policies, generating substantial consumption benefits and enticing inbound travelers with enhanced cross-border shopping experiences.

Shanghai's growth in tax refund applications is mirrored across several Chinese cities, reflecting an accelerating momentum of this policy nationwide. The number of individuals receiving tax refunds in the first eight months surged by an extraordinary 247.8 percent, while sales of tax-refunded goods increased by 97.5 percent year-on-year, with the total value of refunds rising by 96.9 percent, as reported by the State Taxation Administration.

By the end of August, the number of tax refund stores aimed at foreign visitors exceeded 10,000, demonstrating a threefold increase since the close of 2024, according to official figures.

Adding to the buoyant atmosphere, Chengdu, located in Southwest China's Sichuan Province, is set to open its first and only downtown duty-free store, further expanding the duty-free shopping landscape in urban areas.

The new duty-free store is specifically designed for outbound travelers who possess valid entry-exit documents and tickets for flights or international cruises departing within the next 60 days, providing them exclusive shopping opportunities before their departure.

This development is part of a growing trend of urban duty-free initiatives. Following an official announcement in late August, more cities in China are positioned to offer downtown duty-free shopping, facilitating easier access to consumer goods from well-known Chinese brands.

Cities designated for the establishment of new duty-free stores include Guangzhou, Chengdu, Shenzhen, Tianjin, Wuhan, Xi'an, Changsha, and Fuzhou, as outlined in new interim measures for duty-free shops.

Hangzhou serves as a prime example of this retail growth, boasting 267 duty-free stores, a substantial 126.3 percent increase compared to the previous year, while sales of goods eligible for departure tax refunds surged 2.5 times.

China's strategic enhancements to its tourism attractiveness, from tax refunds to various consumption scenarios, illustrate a commitment to fostering its inbound tourism sector. The vision, as articulated by Chinese Vice Minister of Commerce Sheng Qiuping, emphasizes creating a more convenient and enjoyable shopping environment for global travelers, ultimately portraying a more open, inclusive, and innovative China.