Hong Kong’s government has confirmed that, if it finds that its recent measures to curb residential property speculation are not successful, it will introduce further measures, wherever it considers necessary.
In reply to a question in the Legislative Council, the Secretary for Transport and Housing, Eva Cheng, reviewed the measures that the government has already introduced in the last few days to dampen the rise in Honk Kong’s property prices, particularly the special stamp duty and the lowering of maximum loan-to-value ratio by the Hong Kong Monetary Authority.
“We believe,” Cheng said, “that the expectation on the property market will be changed because of the newly introduced measures. With diminished prospect for quick profits from speculating in the property market, there will be less speculation in different forms.”
However, she added that, “to ensure the healthy and stable development of the property market, the government will continue to closely monitor the development in the property market, and will introduce further measures when necessary.”
Given that much of the funds being invested in Hong Kong’s property market are originating from abroad, she was also asked if the government was conducting studies on measures taken by other countries to restrict non-citizens from purchasing local residential properties.
In her reply, she confirmed that the government had considered the proposal of banning non-Hong Kong residents from buying flats in Hong Kong. “However,” she said, “such a proposal would bring about a very fundamental change to our system, would affect the status of Hong Kong as one of the freest market economies in the world.”
It would, she continued “undermine the confidence of overseas companies or investors in Hong Kong as a global financial centre and preferred place for doing business with its so far consistent policies in enabling free flow of capital and barrier-free environment for investment. This would have read-across implications on the overall economy of Hong Kong.”
A comprehensive report in our Intelligence Report series dealing with the issues raised by international property investment, and the possible taxation implications raised by such purchases, with an account of the likely (and some less obvious) potential countries for your consideration, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report15.aspTags: tax | offshore | investment | business | real-estate | real-estate investment | stamp duty | Hong Kong | compliance | Hong Kong
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