February 26, 2020 / 4:32 AM / a month ago

Hong Kong budget for fiscal 2020/21

HONG KONG (Reuters) - The following are highlights of Hong Kong’s budget for the 2020/21 fiscal year starting in April.

Hong Kong is to announce plans for its largest budget deficit in at least a decade to cushion the shock of often-violent protests and the outbreak of a coronavirus on the recession-hit economy.

Many companies in the tourism and retail sectors are struggling to survive as a partial closure of the border reduces visitor arrivals to a trickle and keeps residents away from public areas.

Carrie Lam, the Chinese-ruled city’s leader, has already proposed measures worth HK$30 billion ($3.85 billion) to help small and medium-sized companies and low-income households cope with the health crisis.

The budget is being presented by Financial Secretary Paul Chan on Wednesday.

ECONOMY

* 2019 GDP -1.2%

* 2019 Q4 GDP -2.9% on year

* 2019 Q4 GDP -0.3% from Q3

* Govt forecasts 2020 GDP growth between -1.5% and +0.5%

* Average GDP growth forecast at 2.8% per annum in real terms from 2021-2024

* Expects 2020 headline inflation at +1.7%

* Forecasts 2020 underlying inflation at +2.5%

* Says medium-term economic outlook of Hong Kong remains positive

RELIEF MEASURES

* To implement counter-cyclical measures involving HK$120 billion

* Government will provide guarantee of up to HK$20 billion under concessionary low-interest loans to support smaller firms

PROFITS TAX

* To reduce profits tax for the year of assessment 2019/20 by 100%, subject to a ceiling of HK$20,000

* This will benefit 141,000 taxpayers, and reduce government revenue by HK$2 billion

* To waive rates for non-domestic properties for four quarters of 2020-21

* To waive the business registration fees for 2020-21, benefiting 1.5 million business operators

* To waive the registration fees for all annual returns for two years, benefiting 1.4 million companies

* To provide a one-off special allowance to 200,000 eligible low-income households under the anti-epidemic fund

SALARY

* To remove salaries tax under personal assessment for the year of assessment 2019/20, capped at HK$20,000

* It will benefit 1.95 million taxpayers and reduce government revenue by HK$18.8 billion

* To waive rates in respect of residential properties for four quarters

Reporting by Donny Kwok; Editing by Sam Holmes

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below