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Wednesday, March 27, 1974
EARNING POWER OF FISCAL RESERVES NOT TO BE OVERLOOKED
The Financial Secretary said today that Hong Kong's fiscal
reserves were "an end in themselves to some extent" and called on
Unofficials "not to overlook the earning power of our reserves."
Replying to points raised by Unofficials in the Budget debate,
Mr. Haddon-Cave told the Legislative Council that the reserves now only
represented 53 per cent of Hong Kong's much larger expenditure budget.
Moreover, he said that "we live in a world of unforeseen
contingencies."
On the earning power of our reserves, the Financial Secretary
said in 1974-75 they would bring Hong Kong $360 million.
This representer the equivalent of the yield from more than
four extra percentage points on the standard rate of profits tax."
Mr. Haddon-Cave also reminded Unofficials that one of the considerations
in his tax relief measures in 1972 and 1973 concerned "the way in which
the present generation of taxpayers ha contributed in recent years to the
financial resources available for spending in the future."
He noted that these tax relief measures amounted in all to $163
million a year.
In his Budget speech last month, the Financial Secretary estimated
that Hong Kong's available fiscal reserves at the end of the current financial
year would amount to $3,066 million.
This represente only 53 per cent of estimated expenditure in 1974 75
or 56 per cent of the unspent balance of the approved Public Works Noa-
Recurrent projects at April 1 this year.
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