CONFIDENTIAL #B
To Deputy Financial Secretary
[Attn.: Mr D.K.M. Gibson)
2.
Such a
payments may already be exempt under the general law. course of action would greatly simplify the drafting of the provision.
6.
As an alternative to amending the Ordinance I have considered the provisions of Section 87 under which the Governor in Council may by order exempt any person, office or institution from payment of the whole or any portion of any tax chargeable under the Ordinance. However, this route would involve considerable administrative effort for both this Department and Executive Council since an order would have to be sought on each occasion that a payment under the Scheme was made. For this reason I am not in favour of using Section 87 to achieve the desired object.
7.
Finally, there is the enhanced commutation of pension available under the Scheme. Section 8(2) (c) of the Inland Revenue Ordinance presently exempts from Salaries Tax any sum received by way of commutation of pension if it is paid under the Pensions Ordinance. It is not clear to me whether the Pensions Ordinance is to be amended to take account of the Scheme, but if it is then the total sum commuted, including that attributable to the enhanced factor would be exempt under Section 8(2)(c). Alternatively, if the Pensions Ordinance is not to be amended the enhanced commutation would be exempted by the amendment I have suggested in paragraph 5 above,
AKG:cl
K
d.K. Gill
(A. K. Gil1)
for Commissioner of Inland Revenue
1
J
2014