Financial Secretary Warns Government Against Raising Taxes In Hong Kong

by Mary Swire, Tax-News.com, Hong Kong

10 November 2008

The government's priority should be to stabilize the economy and restore confidence in Hong Kong, the country's Secretary for Financial Services and the Treasury, Prof KC Chan, stated on Sunday.

Mr Chan has insisted that, as part of this strategy, tax increases should definitely not be considered by the government at this time.

Chan quoted Financial Secretary John Tsang as saying earlier that he is not about to increase the burden on the public. The government's priority is to try to increase aggregate demand in the economy.

Speaking to the media after a radio talk show on Monday, Professor Chan said the government is stimulating the economy and trying to prevent further job losses. The government is also ensuring that there is a good supply of liquidity in the banking sector so that there will be confidence in bank lending.

In addition to this, the government is also helping small and medium enterprises by increasing guarantees for some SME funds, as well as being committed to speeding up public works projects and infrastructure projects, to maintain or even increase the aggregate demand for jobs in the economy.

Professor Chan went on to add that businesses should consider their long-term strategy even in times of difficulty, and should try to reorganize their resources in a way to minimize the impact on their staff.

Concluding his announcement, Chan stated that the long-term future of companies and the continuing loyalty of their staff is crucial to the economy's future.

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