Hong Kong Budget Summary 2009/10

Transcription

1 Hong Kong Budget Summary 2009/10 The Financial Secretary, Mr John Tsang, presented the budget for the year 2009/10 on 25 February The budget proposals will be reviewed by the Legislative Council before becoming law. The Financial Secretary forecasted a consolidated deficit of $4.9 billion in the Consolidated Account for the year 2008/09 as compared to the original forecast of the deficit of $7.5 billion for the same period last year. We summarise the 2009/10 budget highlights as follows:- Highlights of the Budget There are no proposed changes to Salaries Tax, Profits Tax, Property Tax and Other Taxes:- Salaries Tax The personal allowances and deductions remain unchanged as follows:- Personal allowances: Single 108, ,000 Married 216, ,000 Single parent 108, ,000 Child 1st to 9th child - Year of birth 100, ,000 - Other years 50,000 50,000 Dependent parent/grandparent Aged 60 or above - not residing with taxpayer 30,000 30,000 - residing with taxpayer 60,000 60,000 Aged 55 to 59 - not residing with taxpayer 15,000 15,000 - residing with taxpayer 30,000 30,000 Disabled dependent 60,000 60,000 Dependent brother/sister 30,000 30,000

2 Deductions: - Self Education 60,000 60,000 - Home Loan Interest 100, ,000 - Approved charitable donations 35% 35% of assessable income of assessable income - Elderly residential care expenses 60,000 60,000 - Mandatory Provident Fund Contribution 12,000 12,000 Under Personal Assessment, income chargeable to Property Tax, Salaries Tax and Profits Tax is aggregated and from this total, various deductions including charitable donations and personal allowances may be deducted. Tax at marginal rates will then be imposed on the balance. Tax charged shall not exceed the standard rate of tax applied to the net total income without personal allowances, ie, total assessable income less total deductions only. Rates of Salaries Tax: The marginal tax rates and tax bands remain unchanged as follows:- Tax Band Tax Rate Tax Band Tax Rate First $40,000 2% First $40,000 2% Next $40,000 7% Next $40,000 7% Next $40,000 12% Next $40,000 12% Remainder 17% Remainder 17% Standard rate 15% Standard rate 15% Note waiver of tax related to 2008/09 salaries tax: Waiver of 50% of salaries tax and tax under personal assessment assessed for 2008/09, subject to a ceiling of $6,000.

3 Profits Tax Profits tax rates remain unchanged as follows:- Profits tax rate Corporation 16.5% 16.5% Others 15% 15% Property Tax Property tax rate remains unchanged as follows:- Property tax rate 15% 15% Stamp Duty The rate of stamp duty on share transfers remains unchanged at 0.2%. The rates of stamp duty on property transactions remain unchanged as follows:- Property consideration Up to $2,000,000 $100 $100 $2,000,001 to $3,000, % 1.50% $3,000,001 to $4,000, % 2.25% $4,000,001 to $6,000, % 3.00% $6,000,001 and above 3.75% 3.75% Other measures affecting us (a) Direct measures by way of waiver of taxes and subsidies: (1) Waiver of rates for the first two quarters of 2009/10, subject to a ceiling of $1,500 per quarter for each rateable tenement. (2) Increase tobacco duty by 50% with immediate effect.

4 (3) Extend the freeze on government fees and charges related to people s livelihood till 31 March (4) Promote the use of electric vehicles and extend the exemption of electric vehicles from First Registration Tax for five years, up to 31 March (5) Provide a 20% rental reduction for most government properties and short term tenancies of government land for three months. (6) Provide funding to the Labour Department to enhance employment programmes and provide employment assistance to employees affected by company closures. (7) Launch an Internship Programme for University Graduates to provide graduates with opportunities to work as interns and receive training in local or Mainland enterprises. (8) Introduce a two-year "Operation Building Bright" campaign for maintenance of 1000 dilapidated buildings. (b) Other medium to long-term measures: (1) Propose changes to Hong Kong tax legislation for the exchange of tax information under avoidance of double taxation agreements. (2) Assist the implementation of 334 new senior secondary academic structure with $7.5 billion to provide professional support to secondary schools and support tertiary institutions in preparing new courses and carrying out infrastructure projects. (3) Promote bond market development by implementing a programme to issue government bonds. (4) Promote Hong Kong as an Asian wine and gourmet centre. (5) Promote conventions, exhibitions and tourism industries. (6) Commence the construction work of the Kai Tak cruise terminal.

5 If you require further assistance on your personal or corporate tax affairs, Eddy Yeung and his team at HLB Hodgson Impey Cheng Taxation Services Limited will be more than happy to talk to you. or ) Important: Individual circumstances vary greatly so specific advice must be sought before undertaking any transactions. Readers are advised not to act solely on the basis of information contained herein. Disclaimer This information is of a general nature only and is not intended to be relied upon, nor to be a substitute for, specific professional advice. No responsibility for loss arising from acting on or refraining from action as a result of any of this information can be accepted. No reader should act on the basis of this information without obtaining independent professional advice with regard to their particular circumstances.