WEDNESDAY, FEBRUARY
25
+ THE LONGER TERM PROSPECTS ARE THAT HUGE PROFITS TAX REVENUE COULD BE LOST. IN ALL PRUDENCE IMMEDIATE STEPS MUST BE TAKEN TO MINIMISE THESE LOSSES, WHILE REMAINING THEMSELVES NEUTRAL IN EFFECT, HE SAID.
SIR JOHN HAS PROPOSED, FROM APRIL 1, 1984, FOR PROFITS TAX PURPOSES, THAT:
*
*
THE DEDUCTION OF INTEREST AND RELATED EXPENSES ON BORROWINGS FROM FINANCIAL INSTITUTIONS (OTHER THAN BORROWINGS BY OTHER FINANCIAL INSTITUTIONS) WILL BE PROHIBITED WHERE THE MONEYS BORROWED ARE SECURED OR GUARANTEED, IN WHOLE OR IN PART, AGAINST A DEPOSIT MADE WITH A FINANCIAL INSTITUTION (WHETHER THE LENDING INSTITUTION OR ANY OTHER SUCH INSTITUTION) BY A CLOSELY CONNECTED PERSON;
THE DEDUCTION OF INTEREST AND RELATED EXPENSES ON BORROWINGS WILL BE PROHIBITED WHERE THE MONEYS BORROWED, IN RESPECT OF WHICH THE INTEREST AND RELATED EXPENSES ARE PAID, ARE MADE AVAILABLE OUTSIDE HONG KONG;
CLOSELY CONNECTED PERSONS WILL BE DEFINED TO INCLUDE THE PROPRIETORS OF UNINCORPORATED BUSINESSES AND THEIR CLOSE RELATIVES AND ASSOCIATED CORPORATIONS OF LIMITED LIABILITY ENTERPRISES; AND
* FOR THE PURPOSES OF THE PROHIBITIONS OUTLINED ABOVE
THE PRESENT DEFINITION OF +FINANCIAL INSTITUTION+, WHICH IS LIMITED TO INSTITUTIONS CARRYING ON BUSINESS
IN HONG KONG, WILL BE ENLARGED TO INCLUDE SIMILAR INSTITUTIONS OPERATING OVERSEAS RATHER THAN IN HONG
KONG.
REVENUE PROTECTION ORDERS SOUGHT
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THE FINANCIAL SECRETARY, SIR JOHN BREMRIDGE, SAID HE WOULD BE SEEKING THE GOVERNOR'S AUTHORITY FOR THE ISSUE OF APPROPRIATE REVENUE PROTECTION ORDERS FOR THE PROPOSED INCREASES IN BETTING DUTY AND TAXES.
1984.
THE PROPOSALS ARE DESIGNED TO COME INTO EFFECT ON APRIL
REVENUE PROTECTION ORDERS HAVE ALREADY BEEN SIGNED TODAY FOK THE DUTIES IMPOSED ON IMPORTED WINES AND SPIRITS, AND THE NEW PATE PERCENTAGE.
+
SIR JOHN SAID THERE WOULD BE FULL OPPORTUNITY FOR DEEATE FTE- THE NECESSARY NEW LEGISLATION IS INTRODUCED INTO THE LEGISLATIVE COUNCIL.