Top Taxpayers Pay a Third of Hong Kong’s Taxes

April 26, 2018 Taxation in Hong Kong

top taxpayers in Hong KongHONG KONG – A third of Hong Kong’s personal income tax comes from the richest people 1.5 percent of taxpayers, and some politicians want them to pay even more.

New information released by the Financial Services and the Treasury Bureau in Hong Kong on April 24th indicates that the top 1.5 highest earning taxpayers in the city paid more than a third of the personal income tax collected in 2017.

In the 2016-2017 year, a total of HKD 63.6 billion in personal income tax was collected in Hong Kong.

The top 1.5 percent of taxpayers directly contributed HKD 22.8 billion of the total.

Of the top 1.5 percent of taxpayers, half had salaries of between HKD 2 million and HKD 5 million, though approximately 2 700 of the richest taxpayers had salaries exceeding HLD 10 million.

Personal income tax in Hong Kong starts at a rate of 2 percent for incomes below HKD 40 000, and peaks at 17 percent for net chargeable incomes of 120 001 and above.

The calculation of net chargeable income in Hong Kong is the amount received after all dedications and allowances used by the taxpayer are considered.

Taxpayers in the top tax bracket also have access to a system where they would face a tax of only 15 percent, if the assessment is made on their income after deductions only.

Typically tax authorities will automatically expect taxpayers to pay the lower amount of tax between the two systems.

Some politicians are calling for the 15 percent rate to be dropped, a move which would improve tax collections by HKD 1.6 billion.