number of submissions had yet to
come.
They therefore recommended that a select committee be appointed in the new session of the Legislative Council to consider further the appropriate measures to be taken to resolve the problems involved in the prosecution and trial of complex commercial crimes. They believed that a study of the Fraud Trials Committee Report when it was published would be helpful, but any recommendations by that Committee would need to be examined in the context of Hong Kong.
(vii) Report
Under Standing Order No. 61(4), a select committee had to report to the Council even if it was not able to complete consideration of the matter before the end of the session when all select committees would be dissolved. Hence a report, together with minutes of the Committee and minutes of evidence, were laid on the Table of the Council at the last LegCo sitting of the session on 7.8.85, and the Chairman, Mr Peter C WONG, made a statement introducing the report.
Inland Revenue (Amendment) (No. 2) Bill 1984
First Reading: 27.6.84
Second & Third Readings: 6.2.85
The Bill sought to enable the Commissioner of Inland Revenue to require the appellant taxpayer to purchase Tax Reserve Certificates (TRCs) to an equivalent amount of tax to be held over. In the event of a successful objection or appeal the taxpayer would be entitled to interest on the certificates so purchased. In the event of an unsuccessful objection or appeal, however, the certificates would be taken in settlement of the tax held over and no interest would be payable on the principal value.
Following introduction of the Bill, a LegCo Ad Hoc Group under the convenership of Mr W CL Brown, was set up to examine the Bill and the public representations. The Group met five times including thrice with the Administration to consider the Bill and the large number of representations received. Amendments to the Bill including the use of bank guarantees in lieu of TRCs were proposed by Members and agreed by the Administration.
At the debate on Second Reading, three Members, Mr W CL Brown, Mrs Rita FAN and Mr Peter POON, spoke.
Mr Brown made it clear that Members had no quarrel with the object of the Bill and rationale behind the agreed amendments. He explained that the amendments would be moved at Committee Stage which would revise the options and add flexibility to the Bill by first giving the Commissioner the option to allow holdover without the purchase of TRCs with a proviso that in the event of an unsuccessful objection or appeal the taxpayer must pay interest on the amount involved and secondly giving the Commissioner the option to permit the taxpayer to provide a bank guarantee in lieu of TRCS provided that the guarantee covered the amount of tax held over plus interest until payment is made in the event the objection or appeal is disallowed.
Objecting to the motion, Mrs Rita FAN emphasised that the taxpayer should always be given the option of choosing between offering a bank guarantee or purchasing TRCs to cover his payment of tax when the Commissioner considered that the taxpayer's objection against a tax assessment had sufficient merit; that the Bill should also provide for an appeal procedure for the taxpayer against delay in finalising an objection by the tax authority; and that the additional measures contained in the Bill could serve little purpose as the existing legislation already provided the Commissioner with the necessary powers to exercise the discretion proposed by the Bill.
Mr Peter POON supported the Bill but pointed out that as interest for TRCS was very low, there might not be incentive for the Inland Revenue Department to expedite the finalisation of objection. He therefore hoped that the Commissioner would continue to exercise his discretion to holdover tax under dispute if a taxpayer's case had sufficient merit and suggested that proper guidelines should be given to the Inland Revenue Department's staff in this respect.
In reply, the Financial Secretary thanked Mr Brown, Mr POON and other Members in the Ad Hoc Group for their support and was sorry that Mrs FAN was not in agreement. He did not believe that her concerns were well-founded and considered that the agreed amendments would serve to broaden and strengthen the Bill.
At Committee Stage, Mr Brown moved amendments to two clauses mentioned in his speech which were agreed and the Bill was read the third time and passed on 6.2.85.
Protection of Wages on Insolvency Bill 1985
First Reading: 13.3.85
Second & Third Readings: 3.4.85
The purpose of this Bill was to provide for the continued existence of the Protection of Wages on Insolvency Fund established under the Business Registration (Amendment) Ordinance, to establish and to incorporate a Board to administer the Fund and to make provision to enable ex-gratia payments to be made from the Fund to employees who had not been paid wages because of the insolvency of their employer.
One representation was received from the "Committee for the
Establishment of a Protection of Wages on Insolvency Fund". It was considered by the Leg Co Economic Services Working Group under the convenership of Mr Allen LEE which met with representatives of the Committee on 23.3.85. The Committee raised a number of points but supported the Bill in principle. After discussion, the representatives agreed that the Bill should be enacted as soon as possible and that changes should only be introduced later after a review.
At the debate on the Second Reading, Mr CHAN Kam-chuen spoke in support of this Bill. He considered that the Bill would achieve two important objectives longed for by workers: first, it could make good wages up to four months subject to a maximum of $8,000 per worker and secondly, it would provide immediate help since application procedures were streamlined and the worker could be paid within one month. He also commented that in fairness, employers would have to shoulder the small levy as it could not have come from the employees or the Government.
In reply, the Commissioner for Labour thanked Mr CHAN for his support for the Bill. At the Committee Stage, the Commissioner moved amendments of a technical nature to a clause. The Bill was read the third time and passed on 3.4.85.
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