HK greenlights foreign gains tax bill

The government will implement the refined FSIE regime on 1 January 2024.

The government has passed a bill that refines Hong Kong's foreign-sourced income exemption regime (FSIE). 

Under the refined FSIE regime, foreign-sourced non-intellectual property (IP) disposal gains will continue to be exempt from tax if the multinational enterprise entity has adequate economic substance in Hong Kong. 

The extent of the tax exemption will be determined by the nexus approach promulgated by the Organisation for Economic Co-operation & Development. 

The government will implement the refined FSIE regime on 1 January 2024.

The government will request the EU to remove Hong Kong from its watchlist on tax cooperation as soon as possible.