Alipay and Swiss tax-refund company Global Blue announced on Monday a service that will allow Chinese tourists to receive tax refunds on their shopping directly into their Alipay accounts.
Starting from July 8, 5,000 retailers across France, Germany, Italy, South Korea and the United Kingdom will provide this service through Global Blue, including luxury department stores such as Harrods in the United Kingdom. More countries are expected to roll out the service in the coming months, both firms said in a joint release.
Global Blue is one of the main ways that millions of Chinese tourists conduct their duty-free shopping overseas. With 27,000 retailers in 37 countries, tourists who purchase items from Global Blue retail partners can apply to get the local sales tax charged on their products refunded to their credit cards, allowing them to shop tax-free. The Global Blue and Alipay tie-up allows Chinese shoppers to apply to get the tax refunded to their Alipay accounts.
Chinese tourists were the top spenders globally last year for the second year running, purchasing $129 billion worth of goods and services overseas, according statistics from the United Nations World Tourism Organization. The number of Chinese outbound tourists is expected to double to 200 million by 2020 from about 97 million in 2013 with 3.5 million of them visiting Europe, according to official media sources.
High taxes on cosmetics and luxury goods back home and the limited variety on offer, make shopping in Europe a big draw for Chinese tourists. Chinese tourists making purchases at Global Blue’s retail partners can ask for a tax-free form which they then fill out with their Alipay user information. Upon exiting the country, they submit the forms and receipts to the customs desk to get it stamped before mailing it to Global Blue. Alternatively, they can apply for a Global Blue Card that will negate the need to fill out forms.
“Given that the European Union an important and popular destination for Chinese travelers, we feel it is important to provide our users with reliable services,” said Alice Zhan, Alipay’s head of international business development for Europe and Africa. “Tax refund is just the start of the ecosystem we are building,” Zhan said.
According to Global Blue, Chinese tourists are for the sixth consecutive year the biggest tax-free shoppers in Europe, with sales up 20 percent in 2013 compared to 2012, representing 27 percent of all Global Blue’s tax refunds.