Gov’t announces tax concession plans

The tax concessions will benefit over 2m taxpayers and 3m properties.

The government introduced a bill to implement the one-off tax concessions and two-tiered standard rates regime as proposed in the 2024-25 Budget. It will be introduced to the Legislative Council on 20 March 2024.

Under the bill, tax under personal assessment and profit tax for 2023-24 year of assessment will be reduced by 100%, subject to a $3,000 ceiling per case, to be reflected in the final tax payable for the said year.

This will benefit 2.06m of taxpayers with salary tax and tax under personal assessment and 160,000 tax-paying businesses. Revenue  forgone for 2024-25 is projected to be around $5.531b.

For the two-tiered standard rates regime, taxpayers with over $5m net income and taxpayers charged at a standard rate, the first $5m of their net income will be subject to the standard rate of 15%, while the portion exceeding $5m will be subject to the standard rate of 16%.

About 12,000 or 0.6% of taxpayers will be affected by this. Revenue will grow about $905m annually.

In addition, the bill will also raise the deduction ceiling amounts of home loan interest and domestic rents for eligible taxpayers to aid families with new-born children.

The government also proposed to waive rates for 1Q2024-25, with a concession ceiling of $1,000 per tenement. This will benefit about 3.51m properties, reflecting a revenue forgone of about $3b.