When Hong Kong’s wine import tax was reduced to zero in 2008, the theoretical justification was that it would establish the city as “Asia’s wine hub”.
It was never clearly stated what exactly the Government imagined a “wine hub” to be, nor any evidence presented that Asia had any need of one. Five years on though the role that we have assumed in the global wine trade is clear. In revenue terms Hong Kong is the wine auction centre not just of Asia, but of the world.
That has not been the only consequence of the tax policy of course. The wholesale and retail wine trade have each expanded exponentially, although that has been a mixed blessing. The wine storage and logistics business has also mushroomed.
Low-end wines are cheaper in supermarkets, although savings made from the removal of the tax have generally not been passed on to customers by fine wine retailers, or by the bar and restaurant trade.
Without any doubt though the principal beneficiaries have been the auction houses – most notably British auctioneers Bonhams, Christie’s, and Sotheby’s, and US wine auction specialists Zachy’s and Acker, Merrall and Condit (AMC).
It was Bonhams that held the first auction after the removal of tax, but like Christies’s and Sotheby’s, while is has a strong fine wines department its business is auctions in general rather than wine in particular.
Those three auction houses have realized significant multiples of millions of dollars from sales of fine wines and spirits in Hong Kong over the past five years, but they have auctions of art, antiques and other collectibles to present as well.
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