Deloitte's budget suggestions to boost HK revenue

Hong Kong should offer tax breaks to Chinese e-commerce firms and software developers that are based in the city but do business globally, says Deloitte.

If these firms voluntarily declare their income, 50 percent of their profits could be treated as offshore income and exempted from tax. This would reduce any uncertainty over taxes for these offshore operators while increasing the city's revenues, Deloitte said in its pre-budget proposals.

It would also encourage more e-commerce firms to shift part of their operations to the city and establish regional headquarters and digital hubs.

To offer new incentives for international commodity traders with headquarters in Hong Kong, a preferential tax rate at 8.25 percent should be introduced, it said.

For the wealth management sector, a recommendation has been put forward to allow high net-worth families or individuals from the mainland to transfer yuan to Hong Kong for investment via single family offices.

CICI CAO