Hong Kong to narrow tax base to attract businesses from rivals

A new policy unit would be set up to review the issue.

According to a report from South China Morning Post, Financial Secretary Paul Chan Mo-po on Wednesday announced a new policy unit would be established in an effort to review Hong Kong’s tax regime and narrow the city’s tax base. In handing down the 2017-18 budget, Chan revealed his plan to widen the salary tax bands, introduce new rebates and increase ­allowances on the back of an estimated HK$92.8 billion fiscal surplus for the current financial year.

He warned, however, the city was vulnerable to volatility in the global economy and financial markets, with 45 per cent of government revenue in 2015-16 coming from land sales and profits tax alone. He said a tax policy unit would be set up under the Financial Services and the Treasury Bureau to review the city’s tax policies and address such issues. 

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