15
WEDNESDAY, MARCH 1, 1978
MR. HADDON-CAVE POINTED CUT THAT IN MANY CASES PROFITS SARNED IN HONG KONG BY A FOREIGN BANK ARE LIABLE TO TAX IN THE COUNTRY WHERE THE HEAD OFFICE OF THE BANK IS SITUATED.
HE SAID: +WHERE THERE EXISTS UNILATERAL RELIEF FROM DOUBLE TAXATION, THE ONLY EFFECT WILL BE TO REDUCE THE TAX PAID TO THE COUNTRY WHERE THE HEAD OFFICE IS SITUATED.
+5UT WHERE THERE IS AN INCREASE IN THE OVERALL TAX LIABILITY, IT COULD BE ARGUED THAT A DANGER COULD EXIST OF THIS TYPE OF BUSINESS BEING TRANSFERRED ELSEWHERE.+.
CN BALANCE, MR. HADDON-CAVE DID CT BELIEVE THAT A SUBSTANTIAL LOSS OF SUCH BUSINESS WOULD BE LIKELY BECAUSE +NOT ONLY ARE BANKS RELUCTANT TO ASCRIPE A TAX MOTIVE TO THE FORM IN WHICH THEY DO BUSINESS, BUT ALSO HONG KONG'S TAX ADVANTAGES ARE CERTAINLY NOT THE ONLY REASON WHY OVERSEAS INSTITUTIONS DECIDE TO CONDUCT OFFSHORE ACTIVITIES HERE,+ HE SAID.
BASED ON PRESENT INFORMATION IN THE INLAND REVENUE DEPARTMENT, AND ON VARIOUS ASSUMPTIONS REGARDING INTEREST RATES AND COVERAGE, THE ADDITIONAL TAX YIELD WILL BE ABOUT $145 MILLION IN 1979-80 AND THEREAFTER ABOUT 80 MILLION PER ANNUM, MR. HADDON-CAVE SAID.
F.3. EXPLAINS PRICING POLICY FOR PUILIC UTILITIES
*****
THE BASIC PRINCIPLE BEHIND THE PRICING POLICY THE GOVERMENT KUST ADOPT FOR GOVERNMENT-CUNED AND OPERATED PUBLIC UTILITY UNDERTAK INGS MUST BE THAT CONSUMERS SHOULD BE CHARGED THE FULL COST OF THE RESOURCES CONSUMED EY EACH UNDERTAKING UNLESS +CONSCIOUS POLICY DECISIONS DICTATE OTHERWISE ON SOCIAL OR POLITICAL GROUNDS+.
+THIS PRINCIPLE IS NOT INVALIDATED SIMPLY BECAUSE THE SERVICES ARE NOT PROVIDED EY THE PRIVATE SECTOR OR BECAUSE THEY ARE OF A TYPE THAT ONLY THE GOVERNMENT CAN PROVIDE,+ THE FINANCIAL SECRETARY, THE HON, PHILIP HADDON-CAVE, TOLD LEGISLATIVE COUNCIL TODAY.
IR. HADDON-CAVE WARNED THAT A REVISION OF WATER CHARGES IS INEVITABLE THOUGH HE HAS DECIDED THE GOVERNMENT SHOULD AIT UNTIL IT HAS MORE EXPERIENCE WITH ITS NEL COMPUTERISEL FILLING SYSTEM.
THE WATERWORKS ACCOUNTS, HE SAID, ERE BARELY IN DALA DE IN 1976/77 AND ARE ESTIMATED TO BE IN DEFICIT BY 9200 MILLIC 1. 1977/78.
/+THE RETUR