Category Taxation in Hong Kong

Hong Kong Drops Tax Breaks on EVs

February 23, 2017 Taxation in Hong Kong

EV Tax BreaksHONG KONG – The “beacon city for electric vehicles” has now dimmed, as Hong Kong drops its generous tax break on electric cars.

On February 22nd the Finance Secretary of Hong Kong Paul Chan Mo-po announced that the government will be drastically cutting back on the tax exemption offered on the registration of electric vehicles, as such vehicles have become popular enough to no longer warrant heavy tax breaks.

Private vehicles being registered in Hong Kong are levied with a tax based on the value of the car, with the first HKD 150 000 of a car’s value taxed at 40 percent, with 70 percent charged on the next HKD 150 000, an additional 100 percent on the next HKD 200 000, and a final 115 percent on the remaining value.

Electric vehicles have been exempt from the taxes since 1994.

Howev...

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Tax Collections Fall 4% in Hong Kong

May 4, 2016 Taxation in Hong Kong

Hong KongHONG KONG – Hong Kong’s slumping property market is hurting the government’s coffers as collections of Estate Duties fall.

In a press release issued on May 3rd the Commissioner of the Inland Revenue Department of Hong Kong stated that tax revenues over the last financial year tax revenues dropped by 4 percent compared to the tax revenues over the 2014-2015 financial year.

The biggest contributor to the decreased tax collections was a drop in the revenues from Estate Duty, which reached only HKD 30 million 2015-2016, despite peaking at HKD 178.2 million in the previous year.

Drops were also seen in the collection of Stamp Duty, which fell by 16 percent to reach HKD 62 681 million, and Salaries Tax, which fell by 2 percent to HKD 57 868 million.

The decrease in collection of Stamp Duty and...

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Tax Revenues Rocket in Hong Kong

May 5, 2015 Taxation in Hong Kong

HONG KONG – Tax measures aimed at cooling the property market in Hong Kong have resulted in an unprecedented rise in tax revenues.

On May 4th the Commissioner of the Inland Revenue Department Wong Kuen-fai announced that the collection of tax revenues in Hong Kong have reached a five year high.

The total tax collections for the 2015 fiscal year were HKD 301.9 billion, a level approximately 24 percent higher than in the previous year.

The spike in the collection of tax revenues has been attributed largely to an increase in the revenues gathered from the collection of stamp duty on the sale of properties, which rose by 80 percent to hit HKD 74.8 billion, after the duties were hiked in order to reign in the city’s escalating property market.

It was noted by the Commissioner that the gove...

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Hong Kong Needs Tax Changes

March 5, 2014 Taxation in Hong Kong

Hong KongHONG KONG – The cost of social programs in Hong Kong will inevitably rise over the next 30 years, and the government should implement tax changes now to be ready to support the ageing population.

On March 3rd a working group, set up by the government of Hong Kong in July 2013, released its anticipated report on the potential directions for economic and fiscal development of the territory over the next 30 years, and on the tax and administrative changes which need to be implemented to facilitate such plans.

The report indicated that after 2018 the economic output of the special administrative region may begin to diminish as the combined effects of an ageing population and local housing constraints put a limit on the effective workforce, and this process will put additional pressure on alr...

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Hong Kong Hits Record High Tax Revenues

May 3, 2013 Taxation in Hong Kong

Hong KongHONG KONG – Tax revenues in Hong Kong have reached a soaring new high, despite a slow down in the local real estate sector, an increase to tax free allowances and a decline on the local stock market.

In a press release issued on May 2nd the Inland Revenue Department (IRD) of Hong Kong revealed that tax revenues in the region over the 2012 financial year grew by 2 percent compared to the previous year, hitting a record high of HKD 242.2 billion.

The growth in tax revenues has been attributed to a 6 percent rise in collections of corporate income tax, which increased from HKD 118 billion to HKD 125 billion.

The IRD noted that collections of personal income taxes fell by 2 percent over the course of the year due to several increases to the tax allowances granted to individual tax payers.

Co...

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