Wednesday, March 13, 1974
9
"Secondly
In view of the significance of foreign investment, he urged the
government to reconsider the imposition of withholding tax.
there is no neod to raise money by taxation since we have a large
reserve", Mr. Wong said.
The economy, he went on, remained basically strong despite the
falling stock market, inflation and the world energy crisis.
Whereas the world economy had experienced five business cycles of boom and recession between 1890 and 1939, he said, Hong Kong had enjoyed,
with most of the world, continued prosperity since the end of World War II in 1945. He attributed this phenomenon to the existence of free enterprise
and low taxation here.
He noted that while revenue increased from $4,900 million in 1972/73 to $5,200 million in 1973/74 an increase of nearly seven per cent exponditure went up by more than 12 per cent, from $4,300 million in 1972/73
to $4,800 million in 1973/74.
"This will probably establish a pattern and
a warning must now be sounded because economic forces not only have a tendency towards fluctuations, but the effects of man-made energy crisis which permeate every economic activity cannot be under-rated."
He also envisaged the financial problem that the long-term
development programmes would pose to Hong Kong.
With Hong Kong's ever increasing social, community, economic and gueral services, coupled with the planned expansion of the ten year programmes in education, medical services and housing, he said, the odds
are that someday expenditure will greatly exceed revenue.
Hong Kons
!
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