Tax cuts for Hong Kong taxpayers have been scaled back as the city’s financial minister announced a series of measures to alleviate economic pressure on the public.
Financial Secretary Paul Chan on Wednesday said the government would reduce salaries tax and tax under personal assessment for 2022-23 by up to HK$6,000, benefitting around 1.9 million taxpayers.
The measure will lower government revenue by HK$8.5 billion, the official estimated.
The reduction was scaled back from last year, when the government cut salaries tax and tax under personal assessment by up to HK$10,000.
Rates concession for domestic properties
The government also pledged to provide rates concessions for domestic properties for the first two quarters of 2023-24, subject to a maximum of HK$1,000 per quarter for each rateable property. Around 3.03 million domestic properties would be involved, causing public revenue to dip by HK$5.2 billion, the minister predicted.
Transport subsidy extended
Residents in Hong Kong will continue to enjoy public transport subsidies as Chan announced plans to extend the current temporary special measures under the Public Transport Fare Subsidy Scheme until October this year. The government will cover one third of the commuters’ actual monthly public transport expenses exceeding HK$200, subject to a maximum of HK$500.
The financial chief said around 3.5 million commuters would benefit monthly, with the measure costing the government an additional HK$1.08 billion.
Allowance for social security recipients
Repeating last year’s relief measure, eligible social security recipients will receive an allowance equivalent to half a month of the standard rate Comprehensive Social Security Assistance payments, Old Age Allowance, Old Age Living Allowance or Disability Allowance. The financial chief the additional expense would stand at around HK$2.721 billion.
An additional expenditure of HK$116 million would come from offering similar arrangements to the recipients of the Working Family Allowance.
The government will hand out a HK$1,000 subsidy to eligible residential electricity account holders, incurring a public expenditure of around HK$2.9 billion. Meanwhile, the existing practice of distributing electricity charges relief of HK$50 per month eligible residential accounts would be extended until the end of 2025.
Around 2.9 million households are expected to benefit from the relief measure.
Public exam fees
The government will cover university entrance examination fees for school candidates who will be sitting for the 2024 Hong Kong Diploma of Secondary Education Examination. The measure is set to cost HK$151 million.
Basic child allowance
Chan on Wednesday proposed raising the basic child allowance and the additional child allowance for each child from HK$120,000 to HK$130,000. The policy is set to benefit 324,000 taxpayers and cut tax revenue by HK$610 million every year.
The 2023 Budget in full:
- Hong Kong unveils HK$761 billion budget in bid to boost post-Covid recovery
- HK$5,000 consumption vouchers for all eligible residents
- Tax cuts scaled back, transport subsidy extended, other relief measures
- Jockey Club to pay HK$12 billion football betting tax over 5 years to increase gov’t income
- Cigarette packs rise by HK$12 in bid to disincentivise smoking
- Police equipment budget rises 59%, despite spending just 8.5% of 2022 allocation
- City expects to see HK$140 billion deficit, but ‘visible rebound’ in economy expected
- Gov’t to spend HK$50m on promotional work as city outlines new local ‘happy’ campaign
- Mixed reviews as critics slam gov’t for overlooking the poor
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