China

Hong Kong Budget Summary 2011 - 2012 

Latest Hong Kong Budget report: www.kpmg.com/cn/en/hk-budget

 

 

Update: On 2 March 2011, the Financial Secretary announced additional measures in response to strong criticism from legislators and the public that the Budget failed to help the needy and the middle-class. Instead of the HKD 6,000 one-time injection into MPF accounts, Hong Kong permanent residents aged 18 or over will receive a HKD 6,000 handout. The HKD 6,000 handout will be allocated to Hong Kong permanent residents through a new platform (yet to be announced) structured to encourage them to save. The Financial Secretary also announced a Salaries Tax reduction of up to 75 percent for the coming year, capped at HKD 6,000.

 

On 23 February 2011, the Financial Secretary, John Tsang Chun-wah, delivered his 2011-2012 Budget Speech to the Legislative Council. KPMG China's Budget Summary comments on the implications of the proposed measures announced by the Financial Secretary.

 

Focus areas:

• Developing the economy

• Caring for people's livelihood

• Preparing for the future

 

Relief Measures

 

• Subsidy of HKD 1,800 to each residential electricity account

• Waiver of rates for 2011-12 capped at HKD 1,500
   per rateable property per quarter

• Payment of two months' rent for public housing tenants

 

 

Mandatory Provident Fund

 

One-off injection of HKD 6,000 into the MPF accounts of all MPF scheme members and members of occupational retirement schemes (Note: See update above)

 

 

Salaries Tax

 

Increase of 20 percent in:

• Allowances for

- dependent parents/grandparents

- additional dependent parents/grandparents

- child

• Deduction for caring for the elderly

(Note: See update above)

 

 

Revenue Measures

 

• First Registration Tax for private cars increased by about
  15 percent

• Excise duty on tobacco products increased by
   41.5 percent

 

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Related links

KPMG Press Release

 

HK SAR Government Website

 

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