XN000022-1985-04-17 — Page 10

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WEDNESDAY, APRIL 17, 1985

MOVING ON TO COSMETIC DUTIES, THE FINANCIAL SECRETARY REITERATED THAT THE YIELD FROM THE DUTIES WAS ESSENTIAL TO THE UNDERLYING BUDGETARY STRATEGY AND OTHER ALTERNATIVES OFFERED MORE DISADVANTAGES.

HE SAID HE SYMPATHISED ALSO WITH THOSE WHO USED COSMETICS AND NOT UNREASONABLY DISLIKED THE PROSPECT OF PAYING A LITTLE MORE.

+BUT A SOLUTION IS IN THEIR OWN HANDS. MORE ECONOMICAL PRODUCTS GIVING BETTER VALUE FOR MONEY MAY BE ABLE TO INCREASE THE IR MARKET SHARE.

+IT WILL ALSO BE SURPRISING IF TOTAL DEMAND DROPS FOR LONG. IF SO NEITHER RETAILERS NOR MANUFACTURERS NOR AGENTS WILL MUCH SUFFER.

+1 DO DRAW THE LINE, HOWEVER, AT BEING ACCUSED OF PROMOTING SKIN CANCER BY TAXING SUNTAN OILS, THE RETAILERS OF WHICH ALREADY APPLY A MARK-UP OF THE ORDER OF BETWEEN 50 PER CENT AND 80 PER CENT,+ HE SAID.

STRESSING THAT FOR STRATEGIC REASONS HE WAS UNABLE TO AGREE TO MAJOR ALTERATIONS WHICH WOULD SERIOUSLY AFFECT THE REVENUE AND THAT TIGHT DEFINITIONS HAVE BEEN DIFFICULT. SIR JOHN SAID HOWEVER THAT AMENDMENTS AS TO DETAIL COULD BE FULLY CONSIDERED AT THE COMMITTEE STAGE AND WOULD INCLUDE A PROPOSAL TO REMOVE ESSENTIAL OILS FROM THE LIST OF DUTIABLE COSMETICS.

ON THE CHARGE THAT THE DUTY ON COSMETICS WAS LIKELY SERIOUSLY TO DETER TOURISTS, SIR JOHN SAID IT FRANKLY LACKED ALL CREDIBILITY.

+THEY CAN BUY ALL THEY WANT DUTY FREE ON DEPARTURE AT KAI TAK. AS MOST COME FROM COUNTRIES WHERE COSMETICS ARE ALREADY HEAVILY TAXED, THEY WILL NOT BE SURPRISED AT THE POSITION HERE.

+NOR INDEED DO I ACCEPT THAT A MAJOR GOAL OF TOURISTS - THE MAJORITY OF WHOM ARE MEN - IS TO STOCK UP IN HONG KONG WITH DUTY FREE EYE SHADOW, FACE CREAM OR LIPSTICKS.

+ I ALSO CONFIRM TO DR HO. M.Y.L. CHEUNG AND MR K.C. CHAN THAT THE EXPORT OF COSMETICS FROM HONG KONG CAN BE CONDUCTED EX-BOND AND THEREFORE ON A DUTY FREE BASIS, HE SAID.

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