Taxation Institute calls for HK$5,000 handout

The Taxation Institute of Hong Kong on Thursday urged financial secretary Paul Chan Mo-po to distribute another round of consumption vouchers worth HK$5,000 to residents to boost the economy.

Ahead of the financial chief’s budget announcement next week, the institute said the government should introduce one-off special relief measures to support members of the public and businesses most impacted by the Covid-19 epidemic.

President of the institute, Carol Liu Zhaohua, told a radio program on Thursday that authorities should waive stamp duty for first home buyers and increase allowances for taxpayers paying salaries tax to improve people’s livelihood.

Meanwhile, in order to encourage more employers to recruit overseas talents and invest together for business development, Liu said the institute recommended authorities allow employers in Hong Kong to claim a profits tax deduction of the remuneration costs paid to qualified overseas talents working and living in Hong Kong, including those under the Top Talent Pass Scheme.

Separately, Liu noted that a narrow tax base has long been a notable feature of Hong Kong’s current tax system, together with the fact that the government revenue is sensitive to
economic fluctuations depending on broader economic changes beyond its control resulted in government revenue volatility. 

She said the institute believes that the government should, at the same time, promote economic growth to increase government revenue, continue to explore ways of broadening Hong Kong's tax base and reducing the city’s fiscal volatility, including considering the possibility of introducing new types of indirect taxes or levies in Hong Kong in appropriate time.