Two revenue bills were gazetted April 20, and will be tabled at the Legislative Council on May 2, seeking to put into effect tax proposals announced in the 2007-08 Budget.
The Financial Services & the Treasury Bureau revealed that the Revenue Bill 2007 comprises two Budget proposals which came into effect February 28, under the Public Revenue Protection (Revenue) Order 2007.
The proposals will: reduce the stamp duty rate on transactions of properties valued between HK$1 million and HK$2 million from 0.75% to a fixed amount of HK$100; and reduce the duty on wine from the existing rate of 80% to 40%, and that on other beverages with an alcoholic strength of no more than 30% from 40% to 20%.
The bureau explained that as the order gives provisional legal effect to these proposals for only four months, it is necessary for the Government to table a bill containing the same proposals at the Legislative Council for enactment.
Other proposals relating to salaries tax and tax under personal assessment will be effected by amending the Inland Revenue Ordinance through the Revenue (No.2) Bill 2007. The bill, when enacted, will come into effect on the day of its publication in the Gazette.
The first proposal under the bill is to revert the marginal tax bands and tax rates of salaries tax to their 2002-03 levels. Each marginal tax band will be widened from HK$30,000 to HK$35,000 and the highest two marginal tax rates will be reduced from 13% and 19% to 12% and 17%. The basic allowance and standard rate remain unchanged.
The second proposal is to increase the salaries tax child allowance from HK$40,000 to HK$50,000 for each child and introduce an additional child allowance of HK$50,000 in the year of assessment in which the child was born.
The third proposal is to increase the maximum amount of salaries tax deduction
for self-education expenses from HK$40,000 to HK$60,000.
The fourth proposal is to reduce 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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