The budget address disappointed residents waiting for a repeat of the 2011 handout scheme.
Hong Kongers are poised to benefit from a series of tax rebates and allowances announced by Finance Secretary Paul Chan in his 2018 budget address but those waiting for a repeat of the 2011 handout scheme were sorely disappointed.
The salaries tax and tax under personal assessment will be slashed by 75% subject to a ceiling of $30,000 and benefit 1.8m individual taxpayers.
Profits tax will also be cut by 75% to a raised ceiling of $30,000 whilst the tax bands for salaries tax was widened from $45,000 to $50,000 and the number of bands raised from four to five.
More breathing room
Child allowances were also raised from $100,000 to $120,000 whilst an expected 600,000 residents with a dependent parent or grandparent will benefit from higher allowances.
Residents tasked with taking care of their elderly would also have more breathing room as allowances are raised from $92,000 to $100,000 whilst a new personal disability allowances of $75,000 was introduced for eligible taxpayers.
For those aiming to own a home in Hong Kong’s heated property market, now might be a good time as property rates will be waived for four quarters for 2018 to 2019 subject to a ceiling of $2,500 per quarter of each rateable property.
A married couple could also now enjoy the option of electing for personal tax assessment.
No handouts this year
Despite a massive $138b in fiscal surplus, which is over ten times the original government estimate of $16.3b, there will be no hand-outs for hopeful Hong Kongers as the surplus will be used to weather unforeseen storms, with the exception of qualified students who will get a one-off $2,000 educational grant.
“Healthy public finances are vital for Hong Kong as they enable us not only to accelerate our development and expand our capacity when the economy is stable, but also to introduce counter-cyclical measures promptly and effectively in times of economic downturn, thereby stabilising the economy and safeguarding people’s livelihood,” Mr Chan said.
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