As of Jan 1, 2016, Xiamen city in Fujian province is authorized to offer a sales tax refund to foreigners and residents of Hong Kong, Macao and Taiwan, China's Finance Ministry announced on Dec 29.

The policy only applies to those who have stayed on the Chinese mainland for no more than 183 days.

To trigger reimbursement, a 500 yuan price floor is set for purchases made at a single outlet by any one individual.

Unpacked or used commodities are not valid for refunds. Neither are goods purchased more than 90 days in advance of a departure date.

Purchased goods must be carried by travellers in person or in their checked luggage when leaving the country.

The tax rebate rate is 11 percent. A 2-percent poundage fee will be charged either by Industrial Bank's local branch or Xiamen Bank – the two appointed agencies for handling the drawback procedure.

The Xiamen government has selected 10 venues to implement the tax policy, including the Crowne Plaza Paragon Xiamen hotel, three Edenus brand ceramic craft stores, the Sumgo Tea shop, and the Caishi lacquer threaded sculpture retail outlet.

For now, only two cross-border transportation portals are allowed to handle the business. They are the Gaoqi International Airport and Wutong passenger ferry port – the latter mainly serves traffic between Xiamen and Kinmen in Taiwan.

The tax refund policy is expected to further boost tourism in Xiamen, following the 72-hour visa free policy for transit passengers and the 24/7 customs clearance service at Gaoqi airport – two initiatives taken in 2015 that helped increase stay-over tourists from overseas markets by 10.25 percent to 1.83 million in the first 11 months of 2015.

Along with Xiamen, Tianjin city and Liaoning, Anhui, Fujian, Sichuan provinces also got the nod to carry out this tax refund policy from the beginning of 2016. Three other regions were previously empowered to offer the service -- Hainan in 2011 and Beijing and Shanghai in July 2015.

By Liu Sitong and edited by Peter Nordlinger