Global Tax Free "Annual Growth in VAT Refunds for Cosmetic Surgery... Hallyu Wave"

[Asia Economy Reporter Yoo Hyun-seok] Global Tax Free, the number one tax refund company in Korea, announced on the 22nd that it expects continuous benefits from the rapid growth of the 'value-added tax refund market for beauty and plastic surgery medical services.' This is because the number of foreign medical tourists visiting Korea is increasing significantly every year, riding the wave of Korean medical and plastic surgery Hallyu.

According to data from the Korea Health Industry Development Institute, the number of foreign medical tourists visiting Korea in 2018 was 464,452, a 16.7% increase compared to the previous year (397,882). Among them, foreign medical tourists related to beauty and plastic surgery, combining dermatology and plastic surgery, accounted for 130,640, making up 28.1% of the total, setting a new record high.

In particular, in Gangnam-gu, Seoul, known as the mecca of medical tourism, the number of foreign medical tourists in 2018 increased by 31.6% compared to the previous year, reaching 95,237 visitors, and it is reported that last year it surpassed 100,000. Among these, tourists who visited dermatology and plastic surgery clinics accounted for 57.7%, the highest proportion. Currently, GTF holds an overwhelming market share of over 80% in the beauty and plastic surgery refund market.

The 'Value-Added Tax Refund System for Foreign Tourists' Beauty and Plastic Surgery Medical Services' has been implemented since April 1, 2016, to encourage foreign tourists to visit Korea and Korean medical services more frequently. It is a system that allows foreign tourists who have received beauty, plastic surgery, or dermatology procedures in Korea to get a refund on the value-added tax.

According to GTF, the beauty and plastic surgery refund commission revenue, which was 670 million KRW in the first year of implementation in 2016, recorded 2.72 billion KRW in 2019, showing a steep growth of 400% over three years. Kang Jin-won, CEO of GTF, said, "With the Hallyu wave, Korea's high-quality beauty and plastic surgery technology has become known worldwide, and the number of foreign tourists coming to Korea for beauty and plastic surgery is rapidly increasing every year." He added, "The Hallyu wave, which started with K-POP content, is expanding beyond music and media into fashion, beauty, and plastic surgery markets."

He also said, "Currently, due to the COVID-19 situation, the domestic and international tax refund markets have been greatly contracted along with the decrease in tourists, but after the situation is resolved, the suppressed demand for overseas travel worldwide will explode at once." He added, "We are preparing for explosive growth in the domestic tax refund market after the COVID-19 situation is resolved."

Meanwhile, GTF, a tax refund company with a domestic market share exceeding 60%, recorded sales and operating profit of 59.8 billion KRW and 6.9 billion KRW last year, increasing by 44% and 895%, respectively.

This content was produced with the assistance of AI translation services.