ACCA Hong Kong welcomes the Government to issue consumption vouchers again this year valued at HK$5,000 and recommends the Government to include accounting profession in Talent List as well as extend the tax exemption to cover virtual assets investments
Financial Secretary Paul Chan Mo-po released the first Budget of the current-term Government today, announced that the 2022/23 fiscal year recorded a deficit of HK$139.8 billion and the fiscal reserves are expected to be HK$817.3 billion by 31 March 2023.
In general, ACCA (the Association of Chartered Certified Accountants) Hong Kong is pleased to see that the Government responds to the public’s expectations, taking a ‘moderately liberal’ fiscal stance and continuing to share its wealth accumulated during Hong Kong’s economic growth at a critical moment of economic recovery. The Government has proposed a number of measures to alleviate the economic burden on the general public and corporate, such as issuing HK$5,000 consumption vouchers, increasing the child allowance, providing financial support to the tourism industry, and launching the ‘Patent Box’ tax incentive, which are expected to bring Hong Kong’s society back to normalcy and in line with ACCA’s view in easing the hardship of Hong Kong people and promoting Hong Kong’s competitiveness.
ACCA welcomes the Government’s response to its suggestions positively, continuing to launch and enhance policies to attract foreign enterprises and talents, such as attracting overseas companies to re-domicile in Hong Kong and updating the Talent list. However, ACCA reiterates its earlier recommendation that the Government can consider including the accounting profession in the Talent List of Hong Kong which can help recruit global talents and address the talent crunch in the financial accounting sector. According to the data released by the Census and Statistics Department last week, Hong Kong’s population has dropped for a third straight year, with a net outflow of 60,000 residents in 2022. Therefore, ACCA welcomes the Government’s plan for nurturing and retaining local talents by providing subsidies to students in Hong Kong and the Greater Bay Area (GBA), which aims to improve productivity and prevent the decline in the labour force from affecting the development of Hong Kong's economy.
Business Environment
In terms of supporting the business environment, Charles Chan, Co-chairman, Tax Sub-committee of ACCA Hong Kong said, ‘ACCA welcomes the Government’s response to our suggestions positively, providing clearer guidelines on whether onshore gains on disposal of equity interests are subject to tax to enhance tax transparency. We are also pleased that the Government introduces concrete relief measures for the business sector such as establishing a task force on virtual asset development to provide recommendations on the sustainable and responsible development of the sector. We wish to reiterate our recommendation that the Government can consider extending the tax exemption to cover investments in virtual assets when it is appropriate, which can allow the market to adapt the digital economy quickly and efficiently.’
Charles continued, ‘ACCA also welcomes the Government’s plan for attracting overseas companies to re-domicile in Hong Kong. We urge the Government to consider offering tax incentives to target industries of strategic importance to Hong Kong to enhance the city’s competitiveness. These incentives could include providing exemptions from profits tax in the first two years and half rate reduction for the subsequent three years.’
Livelihood
Stanley Ho, Co-chairman, Tax Sub-committee, ACCA Hong Kong said, ‘ACCA is pleased to see the Government to have accepted our suggestion on the relaunch of Consumption Voucher Scheme (CVS) at a critical moment of economic recovery. Meanwhile, by capturing the experience in launching the CVS in the previous years, the administration cost is expected to be lower this year with higher efficiency by using the registration data of last year's scheme. However, the Government can consider distributing the monetary amount of the consumption voucher directly to the bank accounts of/via through Old Age Living Allowance for those aged 60 or above and eligible persons with disabilities.’
Stanley added, ‘We welcome the launch of various measures to benefit the public, such as increasing the basic child allowance and the additional child allowance for each child born during the year of assessment from the current HK$120,000 to HK$130,000 starting from the year of assessment 2023/24. The measure is estimated to benefit 324,000 taxpayers and relieve the tax burden on middle class and working parents even though it would reduce tax revenue by HK$610 million a year.’
Media Enquiries: If you wish to discuss the 2023/24 Budget with an ACCA spokesperson, please call (+852) 2973 1106.
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