Usage of the otherwise harmless word will soon merit a fine of as much as $4,500 in China’s capital.
On grounds of promoting “hedonism and spiritual emptiness,” the municipal government of Beijing will be implementing a full ban on using the word “luxury” beginning April 15th.
After the 15th, companies that mount public advertisements in that bear the word or statements to its effect will be fined by as much as $4,500.
According to state media, the usage of “luxury” and other similar words underscores and dramatically widens the gap between the rich and poor.
From CNN Money:
The Chinese-language media has given attention the issue lately. Wang Jianlin, a billionaire property tycoon, recently complained to Beijing News that, “Chinese people sit on airplanes to deliver jobs and tax money to foreign countries.” Chinese cities should be developed as both tourist destinations and shopping destinations, Wang said — but they are prevented from doing so by the luxury tax.
Luxury goods companies seem to be betting on both scenarios, as well as trying new approaches to tap the rising class of consumers. More luxury goods stores continue to open on the Mainland, with companies putting a lot of capital into developing a sales staff. A recent McKinsey report on Chinese luxury demand says that a major risk for companies is failing to open stores in China quickly enough.