Hong Kong's government is set to increase the airport departure tax from HKD 120 to HKD 200, according to the newly announced 2025-26 budget presented by Financial Secretary Paul Chan Mo-po. This tax hike aims to bolster government revenue by generating approximately HKD 1.6 billion annually. The adjustment is expected to take effect from the third quarter of 2025, as part of broader measures to address the territory's substantial fiscal deficit.
Chan's budget proposal, unveiled on February 26, emphasizes the need for the government to review various fees and charges to align them more closely with operational costs and the principle of user pays. Aside from increasing the departure tax, the administration is examining potential adjustments to transportation fees, including tolls for government tunnels and major roads, which could potentially raise another HKD 2 billion for the government budgets annually.
The decision to raise the departure tax is one of several fiscal measures proposed amid rising criticisms about the government's financial management and increasing cost of living faced by citizens. Many residents have expressed concerns about the added burden this tax could impose on travelers, especially as people are increasingly considering crossing the border to Shenzhen for more affordable flight options.
Public reaction to the proposed tax increase has been mixed. Some residents voiced their frustrations on social media platforms, questioning the rationale behind raising fees when the government advocates boosting travel and tourism. Others argue it will detract from Hong Kong's competitiveness as a travel hub, with some stating, "It’s ironic for the government to push tourism and then introduce tax hikes." The sentiment among these residents emphasizes fears of lost business to lower-cost competitors.
For example, one commenter on social media remarked, "If flights from Shenzhen are cheaper, why bother with Hong Kong? This is just going to drive more people away." Contrastingly, other members of the public have shown less concern, believing those who want to travel would not be heavily deterred by the increased tax amount. Some argued, "Honestly, if you’re traveling, what's HKD 80 more?"
The government is also exploring the implementation of border construction fees for vehicles exiting through land border checkpoints, proposing a similar charge of HKD 200 per vehicle. This change is anticipated to generate around HKD 1 billion yearly. The Financial Secretary indicated during his announcements, "The impact on travelers is actually quite minimal when you compare the total cost of travel, and many will still opt for air travel."
While the proposed border fee is aimed at supporting the development of border infrastructure, it has also ignited debate among residents concerning the increasing cost of operating personal vehicles across the border. Some see the move as encouraging public transport use over personal vehicles, particularly with the rise of high-speed rail options, possibly leading to less congestion at border crossings.
Looking beyond the departure tax increase, the Financial Secretary has stated the government would reassess multiple transportation fees to establish more equitable charges reflective of service use. This effort highlights the government’s struggle to maintain fiscal health as it faces considerable budget shortfalls—amounting to tens of billions—as outlined during the budget presentations.
With these changes looming, the government hopes to unify various revenue streams, ensuring sustainability of services offered to the residents of Hong Kong. Chan stated, "We have to adapt our financial framework to be more resilient and responsive to our changing economic environment." These proposed measures are part of the government's attempt to go beyond just taxes and explore various methods of enhancing revenue flows.
Despite the anticipated financial increase, the departure tax hike and associated travel costs may pose significant reactions from the public and could lead to shifts in travel habits among residents who frequently use the airport. The coming months will be pivotal for the General Economy of Hong Kong, gauging how the public adjusts to these planned price escalations.