Taxes up for high-income earners, luxury homes
The government is raising taxes for high-income earners and luxury homes, and re-introducing a hotel accommodation tax, to help boost the SAR's revenue. In his budget speech, Financial Secretary Paul Chan announced a two‑tiered regime for salaries tax and tax under personal assessment from 2024/25.  For individuals earning more than HK$5 million a year, the first HK$5 million will be subject to the standard rate of 15 percent, while the rest will be subject to 16 percent. The government said about 12,000 taxpayers will be affected. Meanwhile, officials want to implement a progressive rating system for properties, with higher rates for premises with rateable value of more than HK$550,000. Chan also said a 3 percent hotel accommodation tax will take effect on January 1, 2025. The government believes it will account for less than 1 percent of the total spending of overnight visitors. The hotel accommodation tax is expected to add HK$1.1 billion to the public coffers each year. Chan also announced that business registration fees will go by HK$200 to HK$2,200 from April 1. That's expected to generate an additional HK$295 million each year. "When considering measures for increasing revenue, we have to take Hong Kong's actual situation into account and avoid taking any hasty actions that may affect local economic recovery and people's livelihood while at the same time maintaining the competitive edge of the simple and low tax regime." Chan added that a review will be carried out on two transport-subsidy schemes, namely the so-called "$2 Scheme" benefiting those aged over 60 or with disabilities and the Public Transport Fare Subsidy Scheme. "We have to emphasise that the government has no intention to cancel these schemes. The review aims to enable the continued provision of subsidies of the schemes in a financially sustainable manner," he said.