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WEDNESDAY, MARCH 19, 1975
REFERRING TO DIRECT AND INDIRECT TAXATION, MR. WANG SAID THE RATIO OF 45 TO 55 WAS OFTEN TAKEN AS A GUIDELINE RATIO DETWEEN THESE TWO FORMS OF TAX BY THE FINANCIAL SECRETARY THOUGH HE HAD NOT EXPLAINED THE LOGIC BEHIND THIS.
HE COULD NOT UNDERSTAND THE FINANCIAL SECRETARY'S STATEMENT ON THE NEED TO FIND NEW SOURCES OF INDIRECT TAXATION AND TO AVOID BECOMING OVER-DEPENDENT UPON DIRECT TAXATION.
→I WOULD THINK THAT DIRECT TAXATION OF ACTUAL PROFITS WOULD BE A FAIRED BASIS AND REPRESENT A MORE LOGICAL SYSTEM OF TAXATION. OVER-DEPENDENCE ON INDIRECT TAXATION MIGHT RESULT IN AN UNFAIR PROPORTION OF THE ECONOMIC BURDEN DEING SHOULDERED DY LOCAL DUSINESSMEN AND CONSUMERS,+ SAID MR. WANG.
*IF AN EMPIRICAL FORMULA HAS TO BE ADOPTED AS A GUIDELINE, AND IN THE LIGHT OF EXPERIENCE IN RECENT YEARS, IT WOULD APPEAR
-- RATHER THAN THE THAT A MORE REALISTIC RATIO WOULD BE 55.45 REVERSE.+
INCREASES ON GENERAL RATES, MR. WANG GONTINUED, WOULD APPEAR AN EASY FORM OF TAXATION TO IMPLEMENT AND WOULD WIDEN THE TAX BASE TO A USEFUL EXTENT,
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HOWEVER HE FELT IT UNVISE TO RAISE GENERAL RATES DUE TO
THE SECOND HIGHEST IN THE FACT THAT RENT LEVELS IN HONG KONG THE WORLD ** WOULD CONSTITUTE A HIGH PROPORTION OF COSTS IN ANY COMMERCIAL UNDERTAKING AND A CONSTANT DURDEN UPON EVERY DOMESTIC BUDGET.
RECENT RENT CONTROL POLICIES TOGETHER WITH A POSTPONEMENT OF REASSESSMENT OF RATEABLE VALUE HERE JUST DEGINNING TO DEMONSTRATE A GENERAL STABILITY IN THIS FIELD, AND MR. HANG HOPED THAT NO RETROGRADE STEPS WOULD DE IMPLEMENTED TO UPSET THIS FAVOURABLE TREND.
TOUGHING ON THE STANDARD RATE OF PROFITS TAX. HE FELT IT WAS HIGH TIME TO RECRUIT ALL THE BEST DRAINS AVAILABLE TO GIVE PROFOUND AND REALISTIC THOUGHT TO THE QUESTION OF A REALLY OPTIMUM PERCENTAGE OF STANDARD RATE FOR PROFITS TAX.
*IT IS OPPORTUNE BECAUSE WE CAN NO LONGER OVERLOOK, OR DENY THE FACT THAT WE ARE FACING A SITUATION, WUEDE A CUOICE MUST DE MADE BETWEEN INCREASING OUR REVENUS BY TAXATION AND CUTTING DOWN ON PUBLIC EXPENDITURE ON SOCIAL SERVICES, AND THE DEVELOPMENT OF THE INFRA-STRUCTURE OF OUR ECONOMY.✨
HONG KONG'S PROSPERITY, HE SAID DEPENDED UPON ITS ABILITY TO ATTRACT FOREIGN INVESTORS, AND A LOW RATE OF TAXATION WOULD ALWAYS DE HELPFUL.
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