UNCLASSIFIED
143401
MDLIAN 931/
SET UP.
5.
GDP IS EXPECTED TO GROW IN 1992-93 BY 5 PER CENT AND ANNUALLY BY A FURTHER 5 PERCENT UP TO 1997. TOTAL EXPORTS ARE EXPECTED TO GROW BY 14 PER CENT, RE-EXPORTS BY 20 PER CENT AND DOMESTIC EXPORTS BY 2 PER CENT IN 1992-93. INFLATION IS EXPECTED TO REMAIN HIGH. PRESSURE IS EXPECTED TO PERSIST ON RESOURCES (PRINCIPALLY ON LAND AND LABOUR) DUE TO THE RESTRUCTURING OF THE ECONOMY TOWARDS SERVICES AND AWAY FROM MANUFACTURING. THE CONSUMER PRICE INDEX IS EXPECTED TO
INCREASE BY AN AVERAGE 9.5 PER CENT THIS YEAR.
6.
NEW REVENUE MEASURES WILL YIELD AN ADDITIONAL HK DOLLARS 2.9 BILLION FOR 1992-93 AND ABOUT 3.8 BILLION DOLLARS IN A FULL YEAR. FIVE TAX CONCESSIONS WILL COST 1.8 BILLION FOR 1992-93 AND ABOUT 2.1 BILLION IN A FULL YEAR. THE OVERALL EFFECT OF THE REVENUE MEASURES IS EXPECTED TO BE NEUTRAL ON THE CONSUMER PRICE INDEX (A) WHILST SOME OTHER MEASURES, INCLUDING ZERO GROWTH IN THE CIVIL SERVICE BUDGETING FOR A SURPLUS AND PLANNED BORROWING, ARE CONSIDERED MILDLY DEFLATIONARY.
7.
CORPORATE PROFITS TAX IS TO INCREASE FROM 16.5 PER CENT TO 17.5 PER CENT, APPLICABLE TO ASSESSMENTS FOR 1992-93. THIS WILL YIELD 850 MILLION DOLLARS IN 1992-93, RISING TO 1.6 BILLION IN A FULL YEAR. RATES ON PROPERTY WILL BE INCREASED BY HALF A PERCENTAGE POINT TO 6 PER CENT OF RENTAL VALUE, GENERATING 940 MILLION DOLLARS IN 1992-93. STAMP DUTY WILL BE EXTENDED TO COVER THE SALE OR TRANSFER OF COVERED WARRANTS. BETTING TAX INCREASED FROM 10.5 TO 11.5 PER CENT FOR STANDARD BETS AND FROM 17 TO 17.5 PER CENT FOR EXOTIC BETS ALTHOUGH THE JOCKEY CLUB IS EXPECTED TO ABSORB SOME OF THE INCREASES. DUTY WILL BE EXTENDED TO INCLUDE DIESEL FUEL FOR PLEASURE BOATS. A 10 PER CENT INCREASE IN EXCISE DUTIES WILL BE LEVIED ON TOBACCO, HYDOCARBON OILS, ALCOHOLIC BEVERAGES AND ALCOHOL.
8.
NO INCREASE IN INCOME TAX WAS PROPOSED. ON INCOME TAX THE AGGREGATE SINGLE AND MARRIED PERSON'S ALLOWANCES WILL BE INCREASED FROM 41,000 AND 82,000 DOLLARS TO 46,000 AND 92,000 DOLLARS RESPECTIVELY. THERE WILL BE INCREASES RANGING BETWEEN 11 PER CENT AND 15 PER CENT IN THE ALLOWANCES FOR FIRST CHILD, SECOND CHILD, DEPENDENT PARENT AND SINGLE PARENT. THESE PROPOSALS WILL COST 850 MILLION IN 1992-93 OR 1.2 BILLION IN A FULL YEAR. DUTY ON SOFT DRINKS WILL BE ABOLISHED AS WILL AN ENTERTAINMENT TAX ON CINEMA TICKETS AND DUTY ON DIESEL OIL FOR FRANCHISED BUS COMPANIES. STAMP DUTY ON STOCK TRANSFERS WILL REDUCED FROM 0.5 TO 0.4 PER CENT
2
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UNCLASSIFIED