Hong Kong Revenue Bill 2007 Approved

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

15 June 2007

The Hong Kong Legislative Council has passed the Revenue Bill 2007, giving effect to stamp duty and alcoholic beverages duty reductions proposed in the 2007-08 Budget.

According to the Financial Services & the Treasury Bureau the stamp-duty reduction will help more families own their homes, while the alcoholic beverages duty reduction will help promote the development of the local catering industry, tourism and wholesale and retail alcoholic beverage trade, and benefit the community at large.

The bureau said the Government intends to promote Hong Kong's development as the region's wine exhibition, trading and logistics centre in the long run.

The Budget proposed to reduce the duty rate on alcoholic beverages (other than wine) containing not more than 30% of alcohol from 40% to 20%, and that on wine from 80% to 40%; and reduce the stamp duty rate on transactions of properties with a value between HK$1 million and HK$2 million from 0.75% to a fixed amount of HK$100.

Last month, relief measures related to salaries tax and tax under personal assessment announced in the 2007-08 Budget were also endorsed by the LegCo.

The Revenue (No.2) Bill 2007 contained four measures: the first measure reverts the marginal tax bands and rates of salaries tax to their 2002-03 levels; the second measure increases the child allowance under salaries tax from HK$40,000 to HK$50,000 and introduces an additional child allowance of HK$50,000; the third measure is to increase the maximum amount of salaries tax deduction for self-education expenses from HK$40,000 to HK$60,000; and the fourth measure reduces the salaries tax and tax under personal assessment for 2006-07 by 50%, subject to a ceiling of HK$15,000.

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