[Asia Economy Sejong=Reporter Son Seon-hee] Starting from this year’s Chuseok holiday, travelers returning from overseas can enjoy a duty-free allowance of up to $800 for their personal belongings. The duty-free limit for alcohol, which was previously limited to one bottle, will be expanded to a maximum of two bottles. This measure is expected to revitalize the travel and tourism industry, which has been weakened by the prolonged COVID-19 pandemic, and provide benefits to those taking late summer vacations or traveling during the Chuseok holiday.
The Ministry of Economy and Finance announced on the 5th the legislative notice of the amendment to the “Enforcement Rules of the Customs Act” containing these details. The sales limits at duty-free shops in both departure and arrival areas will be raised equally. The ministry stated, “After review by the Office of Legislation, the changes are scheduled to be implemented before this year’s Chuseok.” However, the expansion of duty-free allowances for personal belongings at domestic duty-free shops in Jeju will be implemented from next year through amendments to the Restriction of Special Taxation Act.
Through this amendment to the Enforcement Rules of the Customs Act, the government will increase the basic duty-free allowance from the existing $600 to $800. This is the first increase in the basic duty-free allowance in eight years since 2014, and the government explained that it considered changes in the national income level during this period.
Last year, the nominal total income per capita was 40.25 million KRW, about 30% higher than in 2014 (30.95 million KRW), when the previous duty-free allowance was raised. Additionally, although the $5,000 purchase limit at duty-free shops for domestic residents was abolished in March, the duty-free allowance itself remained unchanged, leading to criticism that the effect on consumption activation was limited. Considering the sharp decline in travelers and sales due to the COVID-19 pandemic over the past two years, support for the tourism industry, including duty-free shops and travel agencies facing management crises, was also taken into account. The new rules are planned to be implemented starting from the domestic imports during next month’s Chuseok holiday.
The duty-free limit for alcoholic beverages has also been increased to two bottles (2 liters) for the first time in about 30 years. This follows international treaty standards, such as the revised Kyoto Convention, which recommends a 2-liter duty-free limit for wine in travelers’ personal belongings. However, the combined duty-free value limit for two bottles of alcohol remains at $400, considering that the most commonly purchased types of alcohol by travelers are priced around $200 each.
A Ministry of Economy and Finance official said, “We hope this will help citizens planning trips to relieve the mental and physical fatigue caused by COVID-19, as well as the tourism industry preparing and promoting these travels.”
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