Hong Kong
grammes. Six 'new towns' are being developed in the former rural region of the New Territories at Tsuen Wan, Sha Tin, Tuen Mun, Yuen Long, Tai Po and Fanling-Sheung Shui-Shek Wu Hui to house more than two million people by 1990. Construction of these centres, with their balanced provision of housing, light industry and community facilities is well under way and many people have already moved to them. In addition the government is also implementing development programmes for rural townships located on the New Territories' mainland and on outlying islands.
The Hong Kong Government has been providing public housing since 1954. Public housing estates are planned, constructed and managed by the Housing Authority, established in 1973. The executive arm of the Authority is the Housing Department. At present, about 40 per cent of Hong Kong's 5.1 million people live in Housing Authority estates. The government aims to provide public housing for about half the population by the mid-1980s.
As at November 1981, the Hong Kong Housing Authority had 106 rental estates, and work was proceeding on a further 86 contracts including redevelopment schemes to provide 116,800 flats with a capacity for about 726,000 people. Although most of the existing estates are located in the urban areas, the majority of new estates are being built in three new towns in the New Territories. These new communities will be totally self-contained.
In 1976 the Government launched a Home Ownership Scheme to allow families in the lower-middle income group to buy a flat of their own. Under the scheme, flats are sold at virtually cost price and special mortgage terms are made available. Until October 1981, a total of 12,603 flats had been completed in 12 estates, and in the next four years, an average of 5,000 units will be built under the scheme. In future land values will be excluded from the sale prices of the flats, which will then be much cheaper than the private units.
In addition, the Hong Kong Housing Society, a private organisation which receives land from the government on concessionary terms, provides homes for 170,000 people.
Because Hong Kong lacks large rivers, lakes and underground water supplies, the government has had to devise major schemes to ensure sufficient water. Hong Kong's two largest reservoirs-High Island with a storage capacity of 273 million cubic metres and Plover Cove with a storage capacity of nearly 230 million cubic metres-were built by damming two large sea inlets and replacing the seawater with fresh water. In addition, Hong Kong has 15 conventional reservoirs and one of the world's largest desalination plants. The territory would still have a water shortage if it did not receive supplies from China, who provides approximately one-third of Hong Kong's water, under an agreement with the Bureau of Water Conservancy and Electric Power, Guongdong (Kwangtung) Province.
The unit of currency is the Hong Kong dollar. In November 1981 the middle market rate was about HK$5.65 = US$1. Notes in circulation are $10, $50, $100, $500 and $1,000.
There is no general tariff on goods entering Hong Kong but duties are charged on four groups of commodities-alcoholic liquors, tobacco, certain hydrocarbon oils and methyl alcohol-irrespective of whether they are imported or manufactured locally. All firms engaged in the import, export, manu- facture or sale of dutiable commodities must be licensed.
The different sources of government revenue are:
(1) Earnings and Profits Tax. This tax, introduced for the first time in 1947 by the Inland Revenue Ordinance, is a substitute for the more orthodox type of income tax. Instead of one comprehensive tax there are four separate taxes: profits tax; salaries tax; interest tax and property tax. The standard rate is 15 per cent.
The profit assessed on a Corporation is charged at a standard rate of 16.5 per cent. Otherwise the standard rate is 15 per cent and this rate is applied in full in the case of Profits Tax and Interest Tax. Salaries Tax is levied on net income from employment after deducting personal allowances, self HK$22,500 and wife HK$22,500 respectively. Allowances are given for up to nine children. In addition Dependent Parents Allowance is also given at HK$7,000 each. The rates of Salaries Tax charged vary from five per cent on the first HK$10,000 of chargeable income to 25 per cent on chargeable income exceeding HK$40,000. There is, however, a provision whereby the maximum charge for Salaries Tax shall not exceed the amount of the standard rate on the total assessable income before deduction of allowances. Property Tax, formerly charged on net rateable values, is, from 1st April 1976, charged at the standard rate on the net assessable value of all land and buildings situated on Hong Kong Island, in Kowloon and in a number of areas in the New Territories designated by proclamation of the governor. The remaining areas of the New Territories are exempt from Property Tax. Net assessable value is defined by reference to an amount equal to the annual rent at which a property might reasonably be expected to let (limited in the case of rent-controlled premises to the maximum annual rent permitted under the Landlord and Tenant (Consolidation) Ordinance) and assumes that the tenant undertakes to pay all usual tenant's rates and taxes and the landlord pays the Crown Rent, repairs, insurance and maintenance. Properties occupied by the owner exclusively for residential purposes are exempt from Property Tax.
Under all four taxes the charge is limited to profits or income arising in or derived from the territory. As an alternative to these separate taxes, a resident of Hong Kong may elect to be personally assessed on his total Hong Kong income. A single assessment is then made allowing similar allowances and charging similar rates of tax, as is the case under Salaries Tax. A set-off is then allowed for any amount already paid under the four separate taxes.
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