Securing investments crucial than tax reform, says Chan

Finance Secretary Paul Chan Mo-po ruled out again the possibility of tax reform though the administration is set to face a budget deficit of around HK$100 billion for third year.
Earlier this week, the administration was reportedly exploring options to raise taxes on high earners and lower the threshold.
However, Chan explained tax increases must take into account the impact on the city’s competitiveness in attracting investments and the effects on businesses and individuals, especially since the society has just recovered from the pandemic.
At this point, rebuilding financial stability should focus on securing investments and economic development, which is why the authorities are being very cautious when it comes to raising government revenue, Chan said.
The SAR will consider cutting recurrent expenses, rather than engaging in unnecessary discussions on tax reform, the city's finance chief added.
Recurrent spending will be reduced by 1 percent annually from this fiscal year onward, and the authorities will assess whether there is still room to increase the cuts when preparing the budget in the future, Chan explained.
The budget is set to be unveiled on February 26.